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IDBI Bank posts Rs 2,410 cr net loss in Q1 as NPAs shoot up 15%

The gross NPAs were at 30.78% of advances, higher than 27.95% in the preceding quarter

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Public sector lender IDBI Bank reported a loss for the seventh consecutive quarter as provisions for bad loans ate into its earnings. For the quarter ended June 30, 2018, the bank reported  a net loss of Rs 2,409.89 crore, and if it was not for a Rs 1,745.09 crore tax writeback the loss would have been steeper.

B Sriram, managing director and chief executive officer, IDBI Bank, told DNA Money, “The focus is on managing the stressed corporate book, intensifying recovery initiatives, efficient use of capital, reducing operating costs and building a robust retail book.”

Gross non-performing assets (NPAs) rose 15.21% to Rs 57,806.84 crore at the end of the June quarter from Rs 50,173.20 crore a year ago. The gross NPAs were at 30.78% of advances, higher than 27.95% in the preceding quarter.

Provisions and contingencies surged 157.33% to Rs 5,239.07 crore in the quarter from Rs 2,035.96 crore a year ago; however it declined 50.13% over the preceding to Rs 10,544.34 crore. 

Net interest income (NII) was up 16.89% to Rs 1,638.62 crore during the reporting qarter over Rs 1,401.90 crore a year ago. Other income was at Rs 642.95 crore, down 6.3% from Rs 686.26 crore a year ago.

IDBI Bank’s capital adequacy ratio (CAR) fell to 8.18%, below the RBI regulatory requirement of 9%. Total advances as of June-end declined 15% to Rs 1.58 lakh crore while total deposits fell 1%  to Rs 2.40 lakh crore. The government had given its nod for Life Insurance Corporation to acquire 51% stake in the bank. The bank has made preferential allotment of equity shares for Rs 7,881 crore to the government against the fund infusion made on March 27, 2018.

DEEP IN RED

  • The gross NPAs were at 30.78% of advances, higher than 27.95% in the preceding quarter
     
  • Provisions and contingencies surged 157.33% to Rs 5,239 cr
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