Yes Bank’s FY08 results did not disappoint, with net profit growing 112% YoY to Rs2bn (vs our forecast of Rs1.96bn). Recent concerns on forex derivative losses were unfounded and did not hurt 4QFY08 profits. Profit growth was driven by a strong increase in net interest and non-interest income, lower cost/income ratio and partly offset by rising provision charges. Key profitability ratios remain healthy, with ROA of 1.4% and ROE of 19%. After last month’s earnings downgrade, we still forecast 38% earnings CAGR over FY08-10ii.