The private lender on Saturday reported the highest quarterly net profit of ₹474 crore in three months in June due to a sharp drop in provisions. The lender had reported a loss of ₹630 crore in the same period last year.

net interest Income, or the bank’s core income, rose 26% to ₹2,751 crore. Net interest margin increased to 5.89% from 5.5% a year ago.

Fees and other income doubled over the previous year to reach ₹899 crore.

“We have built a strong foundation for the bank on the basis of which we can enhance the loan book, deposits and profits comfortably from here in a steady manner,” said V VaidyanathanMD, IDFC First Bank. “We have seen steady growth of over 20% year-on-year, both on the lending side as well as the deposits side. Our ex-treasury core operating profit grew 64% to almost ₹1,000 crore, which is a significant . Milestone for us. We have posted highest profit after tax of ₹474 crore in Q1-FY23. Our return on assets has reached around 1% and we expect it to grow from here onwards.”

The bank reported improvement in its asset quality parameters, with gross NPAs falling to 3.36% in the June quarter from 4.61% a year ago. Net NPAs for the quarter came in at 1.30%, at ₹308 crore as against ₹1,872 crore in the previous year period, a decrease of 84%. Credit cost was 0.9%.