Yes Bank reports its first ever quarterly loss of ₹1507 crore

Private sector lender Yes Bank Ltd on Friday reported its first-ever quarterly loss at ₹1,506.64 crore on the back of higher provisions. The bank would have reported a steeper loss if not for a tax write-back of ₹832 crore in the March quarter.

Meanwhile, the bank’s board approved the appointment of Ravinder Kumar Khanna and Shagun Kapur Gogia as additional directors (non-executive, non-independent) with immediate effect. Interestingly, in June 2013, Yes Bank’s board turned down Gogia’s application to be nominated as a director on the bank’s board.

Profit in the March quarter was lower than the ₹1,023.9 crore estimated by a Bloomberg poll of 23 analysts. Total provisions during the quarter increased more than nine-fold to ₹3,661.7 crore, as against ₹399.64 crore in the year-ago quarter. In the December quarter, the bank set aside ₹550.23 crore in provisions.

Yes Bank’s other income, which includes core fee income, dropped 62.58% to ₹531.69 crore from ₹1,420.97 crore in the year-ago quarter.

Net interest income (NII)—the difference between interest earned on loans and paid on deposits—increased 16.33% from ₹2,154.24 crore in the March quarter of 2018 to ₹2,505.93 crore in March quarter 2019. Its net interest margin (NIM)—a key measure of profitability—fell 30 basis points (bps) on a year-on-year basis and 20bps, sequentially.

In a filing to the stock exchanges, it said gross slippages in the fourth quarter stood at ₹3,481 crore, of which ₹552 crore was on account of an airline, and ₹529 crore on account of a stressed infrastructure conglomerate.

The bank has an outstanding loan of ₹2,528 crore to various companies and special purpose vehicles of Infrastructure Leasing & Financial Services, of which ₹2,442 crore has been classified as non-performing asset (NPA), with a specific provision of ₹610 crore prior to the National Company Law Tribunal order dated 25 February.

“Subsequently, the bank has retained classification for the balance exposure of ₹85.9 crore as standard, although this exposure would be required to be classified as NPA,” Yes Bank said in the stock exchange filing.

Its gross NPAs, as a percentage of total advances, were at 3.22% in the March quarter compared with 2.10% in the December quarter, and 1.28% in the year-ago quarter. Post-provision, the net NPA ratio was at 1.86%, against the 1.18% in the December quarter, and 0.64% in the year-ago quarter.

On Friday, Yes Bank’s shares lost 0.13% to close at ₹237.40 apiece, while the benchmark Sensex index gained 0.87% to close at 39,067.33 points.