IDBI Bank Q2 net loss narrows to ₹3,459 crore

Provision coverage improves to 91.25%

HYDERABAD, TELANGANA, 28/03/2018: A view of IDBI bank in Secunderabad on March 28, 2018. IDBI Bank Ltd said that fraudulent loans of Rs772 crore ($118.8 million) were issued from five of its branches in Andhra Pradesh and Telangana. Photo: G. Ramakrishna

IDBI Bank on Friday reported a loss of ₹3,459 crore for the second quarter ended September 30 as provisions for bad loans stayed elevated. This compares with a loss of ₹3,602 crore a year earlier.

The bank — which is under the prompt corrective framework of RBI — has made a provision of ₹3,544.93 crore for bad loans in the reporting period compared with ₹5,481.64 crore a year ago.

Gross NPA ratio improved to 29.43% for the quarter from 31.78% a year ago, and 29.12% as on June 30, 2019. Fresh slippages stood at ₹2,059 crore while recoveries and upgrades were to the tune of Rs 1,759 crore.

Net interest income for period grew by 25% to ₹1,631 crore, while net interest margin improved by 53 basis points to 2.33% for the second quarter as compared to 1.8% a year ago.

The bank’s management attributed the losses to accelerated provisions to the tune of ₹3,425 crore, which helped the lender to improve provision coverage ratio to 91.25% from 68.72% from a year ago.