IOB to return to black soon: CEO

Lender curbs fresh slippages, makes ‘huge recoveries’

Indian Overseas Bank (IOB), which reported a 45% decline in its net loss for the fourth quarter ended March 2019 to ₹1,985.16 crore, will return to the black in the next quarter, according to a top bank official.

“By June 2019, the bank’s balance sheet would have turned black,” said R. Subramaniakumar, managing director and chief executive office, IOB. “This can be attributed mainly to the efforts put in by the bank in arresting fresh slippages and making huge recovery over the last 2.5 years,” he said.

Net loss for the corresponding quarter last year was ₹3,606.73 crore.

He said the net loss was due to increased provisions on non-performing assets and one big account declared as fraud. The impact on account of these two events is about ₹2,150 crore on provisions. IOB’s net income stood at ₹5,473.92 crore (₹5,814.42 crore). Provision coverage ratio improved by 11.94 percentage points to 71.39%.

Gross non-performing assets (GNPAs) stood at 21.97% of gross advances from 25.28% in the year-ago period, while net NPAs improved to 10.81% (15.33%) of net loans. In the quarter, IOB recovered ₹4,102 crore in NPA accounts while fresh slippages were ₹1,402 crore.

Recovery was substantially higher than slippages during the quarter mainly due to focused priority action on arresting slippages and improving recovery in NPA or one-time settlement accounts, he said.

He said that in FY19, IOB recovered ₹757 crore in NCLT accounts. Further, it expects to recover ₹1,247 crore in the June quarter in NCLT accounts where resolution is at an advanced stage, which would reduce GNPAs by ₹2,868 crore.

Recommended for you
This article is closed for comments.
Please Email the Editor

Printable version | Jul 5, 2020 1:00:06 AM |

Next Story