Indian Bank Q1 net profit falls 44% to Rs 2 bn despite rise in income

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State-owned Indian Bank on Thursday reported a fall in its net profit by 44 per cent to Rs 2.09 billion in first quarter ended June.

Bank's net profit in the corresponding April-June quarter of 2017-18 was at Rs 3.72 billion.

Total income during the first quarter of 2018-19 increased to Rs 51.31 billion from Rs 47.88 billion in same period of 2017-18 on good interest and investment earnings.

Even as bank's ratio of bad loans fell from a year ago, in absolute terms the NPAs were high, showed the financial results of the lender in exchange filing.

The gross non-performing assets (NPAs) as a percentage of gross loans by end-June 2018 fell to 7.20 per cent from 7.21 per cent as on June 30, 2017. In absolute value, the gross NPAs were at Rs 118.27 billion by end of first quarter, up from Rs 96.53 billion a year ago.

Net NPAs too fell to 3.79 per cent (Rs 59.98 billion) from 4.05 per cent (Rs 52.38 billion).

Thus, the overall provisioning for bad loans and contingencies in April-June 2018-19 was raised by Indian Bank to Rs 10.29 billion from Rs 7.15 billion a year ago. Provisions for bad loans were Rs 4.56 billion as against Rs 6.81 billion.

"Non-performing loan provision coverage ratio is 64.38 per cent as on June 30, 2018," Indian Bank said.

During the quarter, the bank had appropriated the recovery of Rs 946.1 million in a fully provided NPA account and the amount recovered has been considered as part of NPA recovery, it said.

Stock of the bank closed at Rs 354.80 on BSE, down 5.2 per cent from the previous close.

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