India’s second largest private sector lender – HDFC Bank  continued to maintain its pace of growth. It reported 30 percent year-on-year rise in its fourth quarter (January-March) net profit at about Rs 1,890 crore, aided by robust interest and other income. Since last one decade, net profit has been growing in the range of 30-32 percent Y-o-Y each quarter.

Net interest income or the difference between interest earned and paid rose forecast beating nearly 21 percent to Rs 4,300 crore during the quarter. Other income increased about 30 percent Y-o-Y to Rs 1,800 crore.  Analysts on an average had expected net profit at Rs 1,890 crore and net interest income of Rs 3,974 crore for the quarter.

The bank’s net profit for the full year too rose a little more than 30 percent to about Rs 6,730 crore. Net interest margin stood at 4.5% as against 4.4% a year back. Loans expanded about 23 percent Y-o-Y to Rs 2.40 lakh crore.

“Our credit growth will be higher by a few percentage points than the average industry credit growth in FY14. I will not be surprised if there is a little churn out in wholesale loan book. If the economy picks up, there will be some incremental growth for corporate loans,” Paresh Sukthankar, Executive Director – HDFC Bank, told reporters while announcing Q4 earnings.

Gross net performing asset (NPA) ratio marginally improved to 0.97 percent as against 1.02 percent a year back. Net NPA ratio remains unchanged at 0.20 percent.

Total deposits grew 20% to Rs 2.96 lakh crore outpacing the average industry growth of 14-15%. The share of current and savings account (CASA) improved from 45.4% to 47.4% as on March 31, 2012-13. CASA is the cheap source of funds for banks wherein they pay interest in the range of 0-6% currently.

“In the coming RBI policy, we are hoping for CRR cut. There is a room for liquidity infusion. We have already responded to policy actions. We are currently offering the lowest rate (base rate) in the market. We are a little ahead of the curve,” Sukthankar said.

HDFC Bank share markets fell nearly 2 percent on Tuesday to close the day’s trading at Rs 689 on NSE. “Overall, there is no change in the profit growth,” Ravikant Bhat, banking analyst from SBICAP Securities told moneycontrol.com.

“The management sounded optimism on economic revival. The bank is expected to grow ahead of the industry. However, higher cost to income ratio coupled with reclassifcation of accounting norms may have led to some market apprehension and HDFC Bank shares fell,” he said.

Earlier, the bank used to net off the income from recovery of written off (bad) assets from loan provisions. Now, it is showing as a part of other income component.