Indian Overseas Bank Q3 loss widens to Rs971 crore as bad loans pinch
New Delhi: Indian Overseas Bank (IOB) on Tuesday said that its net loss widened to Rs971.17 crore during the third quarter ended 31 December 2017 as bad loans ratio remained over 20%.
The bank had reported a net loss of Rs554.44 crore in the same quarter a year ago. Sequentially, the loss narrowed compared with Rs1,222.50 crore in the second quarter ended in September 2017.
Total income of the bank also fell to Rs5,062.38 crore during December 2017 quarter, against Rs5,599.50 crore in the same period of 2016-17, the bank said in a regulatory filing.
Interest income stood at Rs4,254.69 crore for the quarter, against Rs4,878.40 crore in year ago same period. Non-interest income rose to Rs807.70 crore, against Rs721.11 crore in the year-ago period.
Even as the bank cut its bad loan proportion marginally, non-performing assets (NPAs) still remain at elevated level with gross NPAs at 21.95% of the gross advances on 31 December 2017, against 22.42% at end-December 2016. Net NPAs, or bad loans, were 13.08% of the net loans by the end of third quarter this fiscal, down from 14.32% by same period last fiscal.
In absolute terms, gross NPAs were Rs33,266.88 crore as on 31 December 2017, versus Rs34,502.13 crore in the same period of 2016. Net NPAs were Rs17,761.22 crore against Rs19,900.75 crore. Thus, the provisions for bad loans and contingencies were raised to Rs1,640.25 crore for the quarter under review.
The bank said there were recoveries of Rs3,020.53 crore during the quarter, higher than Rs2,446 crore a year ago, while total slippages for the December quarter were restricted to Rs1,431.77 crore.
IOB said it has rebalanced the credit portfolio with retail, agri and MSME share of total domestic advances, improving from 54.18% to 64.75% year-on-year. The return on assets were negative at 1.45% for the quarter, against (-)0.79% in the same period last year.
The deposits of the bank as on 31 December 2017 were Rs2.16 trillion and advances were Rs1.51 trillion.