HDFC Bank, India's largest private lender, posted a net profit increase of 18.5% for the October-December quarter on Saturday, supported by increased revenue and solid loan growth.

The quarterly net profit increased from 103.42 billion rupees ($1.51 billion) to 122.59 billion rupees ($1.51 billion). According to statistics from Refinitiv IBES, analysts had predicted 118.33 billion rupees.

The difference between interest earned and paid increased by 24.6%, from 184.44 billion rupees to 229.88 billion rupees. The core net interest margin for the quarter was 4.1%.

For HDFC's third fiscal quarter, advances increased 19.5%, retail loans increased 21.4%, commercial and rural banking loans increased 30.2%, and other wholesale loans increased 20.0%.

Time deposits, current account deposits, and savings account deposits contributed to the 19.9% growth in deposits.

Due to a persistent demand for loans, credit demand in India has increased in recent months, generating a rush for deposits among lenders. The latest figures from the Reserve Bank of India revealed that loans at Indian banks climbed 17.4% in the two weeks ending on December 16 compared to the same period a year earlier, while deposits rose 9.36%.

The asset quality of HDFC Bank was constant during the preceding three months, with its gross non-performing assets (NPA) ratio being unchanged at 1.23 percent and its net NPA ratio remaining maintained at 0.33 percent.

The provisions and contingencies decreased to 28.06 billion rupees from 29.94 billion rupees the previous year.

The bank's credit cost ratio decreased to 0.74 percent from 0.87 percent in the previous quarter and 0.94 percent a year ago.