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Ujjivan Small Finance Bank reported a net loss of ₹273.79 crore for the second quarter of this fiscal due to higher provisions and lower income. The bank had a net profit of ₹96 crore in the same period last fiscal.

For the quarter ended September 30, its net interest income declined by 16.7 per cent to ₹391.36 crore compared to ₹470.14 crore a year ago. Net interest margin was at 8.1 per cent against 10.2 per cent a year ago. Other income declined by 24.1 per cent to ₹46.89 crore from ₹61.79 crore.

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Provisions shot up to ₹436.88 crore in the July-September quarter of this fiscal from ₹97.91 crore a year ago.

NPAs surge

Asset quality deteriorated significantly.

Gross non performing assets surged to ₹1,712.65 crore or 11.8 per cent of gross advances as on September 30 from 9.79 per cent as on June 30 and 0.98 per cent as on September 30, 2020.

Net NPAs were at 3.29 per cent of net advances as on September 30 compared to 0.14 per cent a year ago.

Collections improve

Ujjivan SFB said collections have been improving with the removal of lockdowns and collection efficiency was at 95 per cent in September 2021.

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Martin PS, Officer on Special Duty, Ujjivan SFB, said, “The second quarter of FY22 has shown significant traction in business momentum over the previous quarter with improvement in both disbursements and collections. In the second quarter, we disbursed ₹3,122 crore as local-level lockdowns eased.”

100-day plan

He further said the bank has prepared a 100-day plan focusing on improving business volumes and asset quality as well as retaining talent. Performance against the plan is being closely monitored by the bank Board and corrective actions are put in place if required.

The bank believes that subject to potential third wave of Covid, its GNPA has peaked and will gradually reduce hereon, he added.