Equitas Small Finance Bank (SFB) on Friday reported an over 60 per cent decline in its net profit at Rs 41 crore in the quarter ended September 2021, mainly due to provisions made against restructured accounts.

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The bank had posted a net profit of Rs 103 crore in the corresponding period a year ago.

PAT (profit after tax) affected due to provisions made on restructured accounts. The bank carries a provision of Rs 196 crore towards the restructured book of Rs 1,401 crore, the bank said in a release.

Total income was at Rs 991.40 crore in Q2 of 2021-22, up from Rs 852.08 crore in the same period of the previous fiscal year.

Net interest income for Q2FY22 was higher at Rs 484 crore, as against Rs 461 crore in the same period of FY21, Equitas SFB said.

The bank said total advances restructured for the year at Rs 1,401 crore forms around 7 per cent of the gross advances. It excludes the Rs 140.40 crore of restructuring in RSL 1.0 (restructured loans), which also forms part of RSL 2.0, it added.

Upgradations and recoveries have improved sharply, it said, adding strong revival of credit demand witnessed across products with highest quarterly disbursement of Rs 3,145 crore during Q2FY22.

Advances during the quarter grew by 13 per cent year-on-year at Rs 18,978 crore, and 81.44 per cent of the advances ars secured loans, Equitas SFB said.

However, there was a rise in bank's bad loans proportion with the gross non-performing assets (NPAs) moving up to 4.64 per cent in Q2FY22 as compared to 2.39 per cent in Q2FY21 and 4.58 per cent in Q1FY22.

Net NPAs were at 2.37 per cent, up from 1.09 per cent in year ago period.

Provisions for bad loans and contingencies for the quarter were higher at Rs 137.81 crore from Rs 75 crore in year ago period. Provision coverage ratio stood at 50.09 per cent.

"With no lockdowns and spread of virus under control largely, the bank saw an improved performance all around. While the overall GNPA (gross NPA) remained steady compared to 1st quarter, there was improved collection efficiency leading to reduction in overdue cases between 1 to 90 days," P N Vasudevan, Managing Director and CEO of Equitas Small Finance Bank said.