The lender’s provision and contingencies in the March quarter rose 24 per cent over the same period last year to Rs 4,693.7 crore, which includes contingent provisions of Rs 1,300 crore. In the preceding quarter, provisions and contingencies made by the lender were to the tune of Rs 3,414 crore.
Given the increase in Covid-19 infections across the country, which is being termed as the “second wave”, and the lingering uncertainty because of it, the bank said, its board of directors decided not to propose dividend for the financial year ended March 31, 2021. However, the board shall reassess the position based on any further guidelines from the RBI in this regard.
Interestingly, the bank's gross non-performing assets (NPAs) in the March quarter of FY21 have turned out to be lower than the pro-forma gross NPAs it had declared in the December quarter. At the end of the March quarter, gross NPAs of the bank stood at 1.32 per cent as opposed to pro-forma gross NPAs of 1.38 per cent at the end of the December quarter. It is important to note that the apex court of the country has vacated its interim order that had asked for a standstill on asset classification by the banks. Net NPAs of the bank stood at 0.4 per cent of the advances portfolio.
The bank is also holding provisions to mitigate the potential impact of Covid-19. It is holding floating provisions to the tune of Rs 1,451 crore and contingent provisions of Rs 5,861 crore at the end of the March quarter.
The bank has disclosed that the Reserve Bank of India’s (RBI’s) Covid-19 resolution package has been implemented for 336,020 accounts, amounting to Rs 6,508.7 crore, which included retail loans worth Rs 5,456 crore. The bank is holding a provision of Rs 650 against such accounts.
While advances of the lender grew by 14 per cent to RS 11.32 trillion at the end of the March quarter, retail domestic advances grew by 6.7 per cent and wholesale advances grew by almost 22 per cent. Deposits of the book lender grew by 16 per cent to Rs 13.35 trillion and CASA deposits grew by 27 per cent.
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