CSB Bank witnessed strong growth in Q4 FY24, reporting a 10.3% increase in total deposits to ₹36,861 crore, up from ₹33,407 crore in the previous quarter. The bank's CASA (Current Account Savings Account) deposits grew by 10.9%, reaching ₹8,918 crore, compared to ₹8,042 crore in Q3.

Additionally, gross advances saw a 10.3% rise, climbing from ₹28,915 crore in the previous quarter to ₹31,843 crore in Q4.

Net Profit and Interest Income Performance

Despite strong deposit and advance growth, CSB Bank reported a marginal 1.3% increase in net profit, reaching ₹152 crore from ₹150 crore a year ago. However, the bank's net interest income (NII) declined by 1.9%, dropping to ₹375.4 crore from ₹383 crore in the previous fiscal.

Management's Outlook on Interest Margins and Unsecured Loans

In January, CSB Bank's MD & CEO Pralay Mondal reassured investors that there was no pressure on net interest margin (NIM) in the near term. He stated that the bank's NIM is expected to remain between 4% and 4.2%, as the lender continues to closely monitor funding and deposit costs.

Additionally, Mondal highlighted that unsecured loans constitute only 4% of CSB Bank’s total loan book, and the bank has halted further expansion in this segment to maintain a cautious approach.

Stock Market Reaction: CSB Bank Shares Jump 5%

Following the release of the Q4 business update, CSB Bank's stock surged by 5%, hitting an intraday high of ₹315.65. The stock was trading at ₹308.2 on the BSE around 9:40 AM, reflecting a 2.44% gain.

Investor Sentiment and Market Outlook

The positive momentum in CSB Bank shares comes as investors react to the strong growth in deposits and advances, despite the decline in net interest income. Analysts believe that the bank’s focus on cost management and stable NIM expectations will help sustain growth in the upcoming quarters.

Conclusion

CSB Bank's Q4 results highlight robust growth in deposits and advances, despite minor challenges in interest income. The bank’s stock gained 5% intraday, reflecting investor confidence in its financial stability and future outlook. With the bank maintaining a cautious approach to unsecured loans and closely monitoring funding costs, its long-term growth trajectory remains positive.

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