IDBI Bank reports seventh straight quarterly loss bad loans

Net loss was 24.10 billion rupees ($344.77 million) for the three months ended June 30, compared with a loss of 8.53 billion rupees a year earlier.
IDBI Bank Ltd posted its seventh straight quarterly loss
IDBI Bank Ltd posted its seventh straight quarterly loss

MUMBAI:  Ailing public sector lender IDBI Bank Ltd on Tuesday reported a net loss of Rs 2,410 crore for the quarter ended June 2018 as against Rs 853 crore in the same quarter last year.This is the seventh consecutive quarterly loss for the state-run financier, which has been forced to make higher provisions for bad loans that alarmingly shot up to 31 per cent of total loans —the highest among Indian banks. Gross NPAs stood at 27.95 per cent (of total loans) in the previous quarter and 24.11 per cent in June 2017. In absolute terms, they stood at Rs 57,807 crore during the June quarter, 15.21 per cent up from Rs 50,173 crore in the same quarter last year.

Net NPAs were at 18.76 per cent, compared to 16.69 per cent in the previous quarter and 15.8 per cent in the same quarter last year. Provisions and contingencies surged 157 per cent to Rs 5,239 crore during the June quarter, as against Rs 2,036 crore a year ago. On a quarter-on-quarter basis, they slipped 50.31 per cent.
Net interest income surged 17 per cent to Rs 1,639 crore, as against Rs 1,402 crore a year before, while other income fell 6.3 per cent to Rs 643 crore from Rs 686 crore a year ago. The bank would have reported a higher quarterly loss if there was no tax write back of Rs 1,745 crore.

Meanwhile, IDBI Bank said it received the government nod for an acquisition of 51 per cent stake by Life Insurance Corporation of India (LIC) via a preferential issue/open offer of equity, subject to regulatory approvals. Following the transaction, IDBI will be a subsidiary of LIC, which currently holds an 8 per cent stake in the lender. The government, which will lose its promoter status will continue to hold about 43 per cent stake.

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