Indian Bank Q2 net profit falls 67% at ₹150 crore
Indian Bank’s asset quality deteriorated with gross NPAs rising to 7.16% of the gross advances as of September-end 2018, as against 6.67% a year ago
Mumbai: Indian Bank posted a 66.8% fall in net profit in the second quarter on account of trading losses and higher provisions, it said on Friday.
The bank’s net profit stood at ₹150.14 crore in the second quarter compared with ₹451.55 crore in the same quarter last year. Other income growth fell by 40% to ₹428.3 crore in the September quarter compared with ₹714.6 crore year-on-year due to mark-to-market losses.
Asset quality deteriorated with gross non-performing assets (NPAs) rising to 7.16% of the gross advances as of September-end 2018, as against 6.67% a year ago. Net NPAs too increased to 4.23% of net advances at the end of the second quarter, from 3.41% in the year-ago period.
Provisions jumped by 35% to ₹1,004.33 crore compared with ₹744.55 crore during the same quarter in the preceding year.
The bank added fresh bad loans worth ₹1,624 crore during the September quarter compared with ₹1,038 crore in the previous quarter.
In a call to analysts, the bank’s management said that it expects ₹1,000 crore of slippages per quarter till the end of the year.
The management also said that the bank has an exposure of ₹1,800 crore to Infrastructure Leasing & Financial Services Ltd (IL&FS), of which the bank has classified ₹280 crore as non-performing asset. The bank told analysts it expects to maintain gross non-performing assets below 7% and net non-performing assets at 3.5% for the full financial year.
The bank added that it expects to recover ₹850 crore from resolutions of accounts referred to the National Company Law Tribunal.
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