Tag: loss

SBI posts 67% rise in Q2 net to ₹7,627 crore

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Significant improvement in asset quality and lower loan-loss provisions helped State Bank of India  post highest-ever quarterly standalone net profit in the second quarter at ₹ 7,627 crore.

Resolution of the DHFL account, which allowed the  bank to write-back provisions amounting to ₹4,000 crore, also supported SBI’s bottomline.

The net profit in the second  quarter  ended September 30, 2021 was 67 per cent up year-on-year (yoy) vis-a-vis year-ago quarter’s ₹4,574 crore.

Slippages down

Slippages were about 52 per cent lower yoy at ₹4,176 crore in Q2FY22 against ₹15,666 crore in the first quarter (Q1FY22) ended June 30, 2021.

Dinesh Kumar Khara, Chairman, emphasised that the bank could pull back the first quarter’s retail segment slippages.

“This is the reason for the much lower slippages and also the accounts are performing well.

“Also, our ground level forces have also improved collections. Our collection efficiency stands at about 95 per cent,” he said.

The net interest income  was up about 11 per cent yoy to ₹31,184 crore (₹28,181.50 crore in the year-ago quarter).

Other income, including profit/loss on sale of assets, profit/loss on revaluation of investments (net), earnings from foreign exchange and derivative transactions, recoveries from accounts previously written off, dividend income, etc., declined about 4 per cent yoy to ₹8,208 crore (₹8,528 crore).

Loan-loss provisions declined 52 per cent yoy to ₹2,699 crore against ₹5,619 crore.

GNPA position improves

GNPA position improved to 4.90 per cent of gross advances as at September-end 2021 against 5.32 per cent in the preceding quarter.

Net NPAs position too improved to 1.52 per cent of net advances against 1.77 per cent in the preceding quarter.

As at September-end 2021,domestic advances increased about 5 per cent yoy to ₹ 21,56,055 crore. Foreign offices advances were up about 16 per cent yoy to ₹3,74,722 crore.

Within domestic advances, retail personal advances saw a 15 per cent yoy growth; agriculture (about 2 per cent) and SME (about 1 per cent). However, corporate advances de-grew about 4 per cent.

Khara attributed the muted scenario in corporate advances to working-capital limit utilisation continuing to be low.

“However, credit demand appears to be on the rise with increasing economic activities across India. Corporates too have started planning for future investments, which will create demand for credit going forward,” he said, adding that SBI will see an overall credit growth of 9-10 per cent in FY22.

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RBL Bank Q2 net profit down 78.6%

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Private sector lender RBL Bank reported a 78.6 per cent drop in its standalone net profit for the second quarter of the fiscal on the back of higher provisions and lower interest income.

For the quarter ended September 30, 2021, the bank reported standalone net profit of ₹ 30.8 crore as against ₹144.16 crore in the same period last fiscal.

Its net interest income fell by two per cent on a year on year basis to ₹915 crore in the July to September 2021 quarter from ₹932 crore a year ago.

Net interest margin was also lower at 4.06 per cent as on September 30, 2021 from 4.34 per cent a year ago.

However, other income shot up by 42 per cent to ₹593 crore for the second quarter of the fiscal from ₹418 crore in the corresponding quarter last fiscal.

Provisions jumped up by 33.6 per cent to ₹651.49 crore in the second quarter of the fiscal versus ₹487.56 crore a year ago.

Asset quality deteriorated

The bank’s gross non performing assets rose to ₹3,130.93 crore or 5.4 per cent of gross advances as on September 30, 2021 from 3.34 per cent a year ago. Net NPAs also increased to 2.14 per cent of net advances from 1.38 per cent as on September 30, 2020.

“The economic environment is bouncing back strongly as the pace of vaccination quickens in the country. Our bank is also confident of reverting to normalised levels of business, growth and profitability from the current (third) quarter itself and are on track to exit this financial year with strong profitability ratios setting us up well for 2022-23,” said Vishwavir Ahuja, Managing Director and CEO, RBL Bank.

The bank had a provision coverage ratio, excluding technical write-offs, of 61.7 per cent.

It had an exposure of ₹846.61 crore to accounts where it implemented restructuring under the Reserve Bank of India’s Resolution Framework 1.0 and ₹645.47 crore under Resolution Framework 2.0.

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CrossTower offers ₹5,000 credit to Indian users to learn crypto trading

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CrossTower on Friday announced a unique feature by offering free credit of ₹5,000 to each Indian user’s wallet for trading on cryptocurrency on its platform.

“Due to cryptocurrencies’ volatility, many users are still wary about investing in the crypto market,” it said in a statement, adding that CrossTower launched this feature to allow Indian users to learn crypto trading comfortably without investing a single rupee.

CrossTower users will learn and also earn profits that they can withdraw for personal use, after settling the full credit amount, the statement further said, adding that users can claim and use a free credit amount of ₹5,000 and trade with multiple currencies.

If the price of crypto decreases, CrossTower will bear the loss, it said.

“CrossTower is introducing this unique feature so that Indian users can experiment with their ability to engage in trading without spending,” said Vikas Ahuja, Chief Executive Officer, CrossTower India

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IDBI Bank Q2 results: Net profit up 75%

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IDBI Bank reported a 75 per cent year-on-year (yoy) increase in second quarter standalone net profit at ₹567crore, supported by a huge write-back in provisions for non-performing assets (NPAs) and lower tax expense.

The Bank had posted a net profit of ₹324 crore in the year ago quarter.

Net interest income increased 9 per cent yoy in the reporting quarter to ₹1,854 crore (₹1,694 crore in the year ago quarter).

Other income, including income from non-fund based banking activities such as commission, fees, earnings from foreign exchange and derivative transactions, and profit and loss from sale of investment, declined about 4 per cent yoy at ₹846 crore (₹881 crore).

The received a write-back of ₹1,426 crore in provisions for NPAs against ₹165 crore in the year ago quarter. Tax expense burden was lower at ₹215 crore (₹347 crore).

As at September-end 2021, gross advances barely nudged up to ₹1,64,506 crore (₹1,63,841 crore as at September-end 2020).

Rakesh Sharma, MD & CEO, said the Bank has built up a sanctions pipeline in the mid and large corporate segments and disbursals are expected to pick up from year-end onwards.

The Bank expects to grow its corporate loan book by about ₹6,000 crore in the current financial year.

Samuel Joseph, Deputy Managing Director, said the Bank has an exposure of about ₹400 crore to the SREI group, which is undergoing corporate insolvency resolution process, and has made 100 per cent provision towards this exposure. IDBI Bank recovered ₹196 crore from DHFL.

P Sitaram, CFO, emphasised that the Bank will grow the corporate loan book even as the emphasis will continue to be on structured retail loans.

Gross NPAs declined about ₹1,186 crore during the reporting quarter to ₹34,408 crore.

Gross NPAs as a percentage of gross advances declined to 20.92 per cent against 21.48 per cent in the preceding quarter. Net NPAs, however, nudged up to 1.62 per cent of net advances against 1.56 per cent.

Fresh slippages rose by ₹1,438 crore (₹1,332 crore in the first quarter). The Bank settled NPAs aggregating ₹1,436 crore (₹587 crore).

ends

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IDFC First Bank logs Rs 630 crore loss in Q1 on Covid provisioning, BFSI News, ET BFSI

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Private lender IDFC First Bank on Saturday reported a net loss of Rs 630 crore in the April-June quarter due to provisioning measures for cushioning the impact of the second wave of the Covid-19 pandemic. The bank had posted a net profit of Rs 93.55 crore in the year-ago quarter ended in June 2020 and that of Rs 127.81 crore in the previous quarter ended in March 2021.

“Net loss of Rs 630 crore for Q1FY22 is because of prudent provisions for Covid wave 2.0. Covid provision pool increased from Rs 375 crore to Rs 725 crore during the current quarter on a prudent basis to act as a cushion for Covid impact,” IDFC First Bank said in a release.

The bank expects to collect a reasonable proportion of these dues in due course, it added.

Total income (net of interest expense) grew by 36 per cent year-on-year to Rs 3,034 crore in Q1FY22, driven by the growth in NII and fee income, the bank said. Its total income during Q1FY21 stood at Rs 2,229 crore in June 2020 quarter.

The bank said its net interest margin (NIM) — the difference of interest earned and expended — was the highest ever at 5.51 per cent during the reported quarter. The NIM was 4.86 per cent in year ago quarter.

The net interest income (NII) rose by 25 per cent year-on-year to Rs 2,185 crore.

On the asset front, bank’s gross and net non-performing assets (NPAs) were at 4.61 per cent and 2.32 per cent respectively as of June 30, 2021.

The NPA ratios were up from 1.99 per cent and 0.51 per cent respectively, from year ago period.

“The GNPA and NNPA include impact of 84 bps (basis points, which is one hundredth of a percentage) and 71 bps respectively on account of one Mumbai based infra toll account which slipped during the quarter. The bank expects no material economic loss in this account eventually as this is an operating toll road and is only delayed.”

Bank deposits were up by 36 per cent to Rs 84,893 crore. The retail loan book of the lender increased to Rs 72,766 crore as on June 30, 2021 from Rs 56,043 crore.

The year-on-year growth of the retail loan book was 27 per cent excluding Emergency Credit Guarantee Line loan book of Rs 1,645 crore. However, it declined by 1.2 per cent on a sequential basis. The wholesale loan book fell by 15 per cent to Rs 34,232 crore from Rs 40,275 crore.

Capital adequacy ratio stood at 15.56 per cent with CET-1 (common equity tier-1) ratio at 14.86 per cent. Average liquidity coverage ratio (LCR) was at 166 per cent for Q1FY22.

“Within just two years we have made tremendous progress at the bank. Our CASA (current account savings account) ratio is high at 50.86 per cent despite reducing savings account interest rates by 200 bps recently, which points to the trust customers have in our bank and service levels.

“Because of our low cost CASA, we can now participate in prime home loans business, which is a large business opportunity,” V Vaidyanathan, Managing Director and CEO, IDFC First Bank, said. Regarding the loss during the quarter, he said the bank has made prudent provisions for Covid second wave.

“We expect provisions to reduce for the rest of the three quarters in FY22. We guide for achieving pre-Covid level gross and net NPA, with targeted credit loss of only 2 per cent on our retail book by Q4FY 22 and onwards, assuming no further lockdowns,” he said further.



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Mahindra Finance posts Q1 net loss of ₹1,573 crore

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Amidst Covid related stress in rural and semi-urban markets, Mahindra & Mahindra Financial Services reported a consolidated net loss of ₹1,573.4 crore in the first quarter of the current fiscal against net profit of ₹432.12 crore in the corresponding period in 2020-21.

Total income declined 16 per cent to ₹2,567 crore during the quarter ended June 30, against ₹3,069 crore in the corresponding quarter last year.

To cover any contingencies due to the Covid-19 pandemic, the company carried an additional overlay of ₹2,709 crore (pre-tax) in the standalone financial statements and ₹2,808 crore (pre-tax) in the consolidated financial statements as of June 30.

Noting that the second wave of Covid had a severe impact on the semi-urban and rural markets, where it has major operations, Mahindra Finance said for the first quarter , disbursements dropped 35 per cent on a sequential basis to ₹3,872 crore, though it grew 42 per cent on a year-on-year basis.

Gross non-performing assets were higher at 15.5 per cent as on June 30, compared to nine per cent as of March 31, 2021.

“The company believes that the elevated NPAs are not a reflection of any credit risk increase but are purely delays caused by liquidity situation. Our experience in the past has always shown a return to normalcy by these segments of customers once their earnings stabilise,” Mahindra Finance said in a statement, adding that as the market conditions normalise over the next few quarters.

During the first quarter, it implemented resolution plans to relieve Covid -19 related stress of eligible borrowers in 59,455 loan accounts with a total outstanding of ₹2,172 crore.

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Central Bank posts ₹1,349-crore loss in Q4

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Central Bank of India slipped into the red, reporting a loss of ₹1,349 crore in the quarter-ended March 31, 2021 against a net profit of ₹165 crore in the preceding quarter (Q3FY21).

The bank’s net loss in the reporting quarter, however, was lower that the year ago period’s net loss of ₹1,529 crore.

NII, NPAs fall

Net interest income (difference between interest earned and interest expended) was down 21 per cent year-on-year (yoy) at ₹1,516 crore (₹1,926 crore in the year ago quarter).

Other income, including income from non-fund based activities, was up about 13 per cent yoy at ₹902 crore (₹795 crore).

Gross NPAs declined to 16.55 per cent of gross advances as at March-end 2021 against 18.92 per cent as at March-end 2020.

NPA provisions jumped about 100 per cent yoy to ₹3,259 crore.

Net NPAs position improved to 5.77 per cent of net advances as at March-end 2021 against 7.63 per cent as at March-end 2020.

Total deposits increased by 5.17 per cent yoy to stand at ₹3,29,973 crore as at March-end 2021. Total advances increased 2.71 per cent yoy to ₹1,76,913 crore.

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Anchor investor Bay Tree India cuts stake in YES Bank to 5.40%

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Bay Tree India Holdings I LLC has cut its stake in YES Bank further from 6.03 per cent as at March-end 2021 to 5.40 per cent now.

Bay Tree India Holdings (BTIH) had 7.48 per cent stake in YES Bank as at December-end 2020.

BTIH, which is a part of New York-based Tilden Park Capital Management, was the biggest anchor investor in YES Bank’s further public offer (FPO) in July 2020.

It invested about 55 per cent of the ₹4,098 crore the bank mopped up from anchor investors. Overall, the bank raised ₹14,850 crore (net of share issue expenses) through the FPO.

Along with BTIH, Axis Bank and Kotak Mahindra Bank, too, cut their stake in the private lender in the fourth quarter of FY2021.

As at March-end 2021, Axis Bank and Kotak Mahindra Bank’s shareholding in YES Bank came down to 1.96 per cent (2.39 per cent as at December-end 2020) and 1.52 per cent (1.76 per cent), respectively.

State Bank of India (SBI) continues to be the biggest investor in YES Bank, with 30 per cent stake. India’s largest bank reduced its stake in the private sector bank from 48.21 per cent to 30 per cent in the second quarter of FY21.

Troubled financials

YES Bank reported a net loss of ₹3,788 crore in the fourth quarter ended March 31, 2021 against a net profit of ₹2,629 crore in the year ago quarter.

In the reporting quarter, the bank made a substantial provision of ₹6,510 crore towards bad loans against ₹1,100 crore in the year ago quarter.

The bank’s net interest income was down 22.5 per cent year-on-year (y-o-y) to ₹987 crore. Non-interest income rose 36.6 per cent y-o-y to ₹816 crore.

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GIC Re reports Q3 net profit at ₹987.42 cr

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State run re-insurer General Insurance Corporation of India (GIC Re) reported a net profit of ₹987.42 crore for the third quarter of the fiscal as against a net loss of ₹1,069.64 crore for the same period last fiscal.

For the quarter ended December 31, 2020, GIC Re reported gross premium written of ₹11,668.51 crore, a 1.1 per cent increase over ₹11,539.96 crore of gross written premium a year ago.

Underwriting loss for the third quarter 2020-21 is recorded at ₹1,022.64 crore as against underwriting loss of ₹2,749.44 crore in the corresponding period last fiscal.

Solvency ratio increased to 1.53 as on December 31, 2020 as compared to 1.51 a year ago.

Combined ratio stood at 108.5 per cent at the end of the third quarter this fiscal versus 130.4 per cent a year ago. “As compared to the second quarter, there is a growth in business volume during the third quarter of 2020-21,” GIC Re said in a statement on Thursday.

It added that though the Covid-19 pandemic continues to influence the insurance industry, the severity of the impact is gradually reducing and is reflected in the results of the industry.

Financials

“GIC Re’s financials for the nine months ended December 31, 2020 have shown indications of positivity and signals turnaround in the near future,” it further said, adding that the underwriting performance is expected to show better trends going forward.

GIC Re’s international business has shown a growth rate of 23 per cent.

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