Mumbai, Oct 15 : HDB Financial Services, a subsidiary of HDFC Bank, reported a 1.5 per cent decline in net profit at Rs 581 crore for the second quarter of the current financial year (Q2 FY26), the non-banking financial company said in an exchange filing on Wednesday.

The NBFC had posted a net profit of Rs 591 crore in the corresponding quarter a year ago (Q2 FY25).

However, the company's overall revenue for the quarter increased 13 per cent to Rs 4,545 crore from Rs 4,007 crore in Q2 FY25, despite the decline in profit, due to consistent growth in loans. Additionally, interest income rose 13 per cent annually to Rs 3,887 crore.

The bottom line was impacted by the sharp 74 per cent increase in loan losses and provisions to Rs 748 crore during the quarter.

The company set October 24 as the record date and declared an interim dividend of Rs 2 per share for FY26.

During the quarter, pre-provisioning operating profit was Rs 1,530 crore compared to Rs 1,230 crore for the quarter ended September 30, 2024, an increase of 24.4 per cent. At the same time, loan losses and provisions were Rs 748 crore for Q2 FY26 compared to Rs 431 crore in the previous quarter last year.

The shares of HDB Financial Services closed 0.3 per cent higher at Rs 742.4 each on the NSE on Wednesday.

HDB Financial Services Limited (HDBFS) is a non-deposit-taking non-banking finance company, offering a wide range of loan products to individuals, emerging businesses and micro enterprises. Established in 2007 as a subsidiary of HDFC Bank Limited, HDBFS is categorised as an upper-layer NBFC by the RBI.

Meanwhile, group company HDFC Life Insurance reported a 3.2 per cent year-on-year rise in profit after tax (PAT) to Rs 449 crore for the same quarter, while its net premium income grew 13 per cent to Rs 18,871 crore. On a half-yearly basis, HDFC Life's PAT rose 9 per cent to Rs 994 crore.

/IANS