Banks saw soured loans and provisions surge in Q4 after RBI in Feb eliminated half a dozen loan restructuring schemes to hasten the clean-up of bad debts,
Mumbai : IDBI Bank on Friday reported widened net loss at Rs 5,662.76 crore in the quarter ended March 2018 as the state-run lender booked higher provisions following stricter central bank rules on bad loans.
The bank had reported a net loss of Rs 3,199.77 crore in the corresponding January-March quarter of 2016-17.
Banks saw soured loans and provisions surge in the quarter after the central bank in February eliminated half a dozen loan restructuring schemes to hasten the clean-up of near-record levels of bad debt. Most of the legacy issues on asset quality have been recognised, IDBI Bank CEO M K Jain said in a press conference after results, adding 97 billion rupees of loans slipped to non-performing assets due to RBI’s latest circular.
Provisions for bad loans surged 80 per cent to Rs 10,544 crore, while that for non-performing assets rose 78 per cent.
The bank’s income during the quarter was Rs 7,913.82 crore, marginally up from Rs 7,703.19 crore in the year-ago period, it said.
IDBI Bank’s gross NPA soared to 27.95 per cent of its loans at March 2018-end compared to 21.25 per cent at the end of March 2017. Similarly, the net NPAs were 16.69 per cent compared to 13.21 per cent.
In absolute terms, gross bad loans stood at Rs 55,588.26 crore, up from Rs 44,752.59 crore on March 31, 2017. The provisioning for NPAs were raised to Rs 10,773.30 crore in the fourth quarter of the fiscal ended March 2018, up from Rs 6,054.39 crore parked aside in the year ago period.
