Ujjivan Financial Services reports Rs75 crore loss in Q1 due to demonetisation
Mumbai: Bengaluru-based small finance bank, Ujjivan Financial Services Ltd has reported a net loss of Rs75 crore during the first quarter of financial year 2017-2018 against a profit of Rs17.37 crore for the same period last year.
Ujjivan reported losses on account of poor recovery of loans during the demonetisation phase and also due to its transition from microfinance institution to a small finance bank (SFB), the company’s chief executive said on Thursday.
“It was a very difficult phase for us (December to March) as we faced twin challenges of deteriorating asset quality and the task of becoming a SFB at the same time,” said Samit Ghosh, managing director and chief executive at Ujjivan Small Finance Bank. He further said that the SFB is likely to recover its losses by end of the financial year as its provisions have “peaked” in April-June quarter of the current financial year. Ujjivan’s provisions for the reporting quarter stood at Rs150 crore.
Ghosh said he expects a loan growth of 20% during the current financial year. The SFB’s loan book grew 10.4% during the reporting period over the same period last year and stood at Rs6,459 crore. It plans to open 160 SFB branches by the end of financial year 2018. The SFB which started its banking operation in February 2017 has 65 SFB branches at present.
Ujjivan SFB’s net interest income (NII) and net interest margin (NIM) also fell due to the investments made by it for setting up its banking operations. While the NII stood at Rs138 crore, down by 19.7% during the same period last year; the NIM stood at 9.23% down from 12.96%. “The margins will improve after we are notified as a scheduled bank,” Ghosh said.
Latest News »
- 3 infants die of alleged disruption in oxygen supply in Raipur hospital, probe ordered
- Narendra Modi, Amit Shah to monitor performance of BJP-ruled states
- Mosque amidst temples in Ayodhya was built by Babar’s commander: Shia Waqf Board
- Before Vishal Sikka exit, mutual funds had hiked Infosys share holdings
- Shrikant Purohit’s bail triggers war of words between Congress, BJP