State-run lender Bank of India (BoI) posted ₹1,046 crore loss for the January-March quarter of 2016-17 as compared with ₹3,587 crore loss recorded in the year-earlier period.
The bank reported fresh slippages of ₹6,915 crore in bad loans during the quarter as compared with ₹16,805 crore during the fourth quarter of 2015-16, which resulted in a bad loan provisions of ₹4,483 crore as compared with ₹5,441 crore.
“NPA (non-performing assets) management is the call of the day, we are focusing on both resolution and recovery,” said Dinabandhu Mohapatra, managing director and chief executive officer, BoI. during the post-earnings press briefing.
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He said his focus would be to turn around the bank in the quickest time. Mr. Mohapatra said BoI was also re-balancing its portfolio towards retail, small and medium enterprises. It’s portfolio was predominantly corporate now.
The bank’s gross non-performing assets rose to ₹5,2045 crore as on March 31, 2017 which was 13.22% of gross advances as compared with ₹49,879 crore (13.07%). Net NPA ratio was 6.9% (7.79%). Both the ratios, however, improved marginally on a sequential basis. The bank has increased its provision coverage ratio from 51.14% to 61.47% in the last one year. Its net interest margin also improved from 2.39% in Q4 from 2.06% in the year-earlierperiod.
For the full year 2016-17, the bank posted a loss of ₹1,558 crore as compared with ₹6,089 crore in the year-earlier period. The bank’s return on assets was negative for two consecutive years, FY’16 and FY’17.
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Earlier this month, the government appointed Mr. Mahapatra as its chief executive replacing Melywn Rego, without citing any reason.
Bank of India is also one of the 10 banks shortlisted by the government which needs to improve its financial position over the next few years.
The Reserve Bank of India (RBI) had allowed the bank to make interest payment of ₹4,13.22 crore for Additional Tier 1 (AT1) bonds from its revenue reserves for 2016-17. The losses could have gone up if the relaxation was not permitted by the banking regulator.