IndusInd Bank has experienced a rise in provisions due to a one-time profit impact, as it expects a gradual reduction in stress in its micro-finance institution (MFI) segment.
The quality of assets in the micro-finance loans segment has declined, with the gross non-performing assets (NPAs) increasing to 6.5 percent in Q2FY25, up from 5.16 percent in the previous quarter.
Furthermore, the bank's overall gross NPA ratio rose to 2.76 percent in Q1FY25, indicating widespread stress across its entire loan portfolio. This trend highlights the challenges faced by the bank as it deals with increasing asset quality issues.