IDBI Bank sees Rs 3,801 crore loss on higher provisions

The bank said its provisions increased by Rs 1,200 crore after Reserve Bank of India had asked banks to downgrade the said accounts.

Published: 15th August 2019 08:04 AM  |   Last Updated: 15th August 2019 08:04 AM   |  A+A-

IDBI Bank

IDBI Bank

By Express News Service

MUMBAI: The IDBI Bank, which came under the ownership of LIC last fiscal, posted a net loss of Rs 3,081 crore for the first quarter of the current financial year, higher than the Rs 2,409.89 crore a year ago, mainly on account of provisioning on two large corporate accounts.

The bank said its provisions increased by Rs 1,200 crore after Reserve Bank of India had asked banks to downgrade the said accounts.

IDBI Bank’s fresh slippages or first time NPAs fell from Rs 7,799 crore in first quarter last fiscal to Rs 3,486 crore in first quarter of this fiscal. Net NPA ratio improved to 8.02 per cent from 18.76 per cent last June and 10.11 per cent in March. Gross NPAs showed marginal improvement from 30.78 per cent last June to 29.12 per cent this year.

Tier-I capital and CRAR (Capital to Risk Weighted Assets Ratio) ratios were also marginally lower at 6.14 per cent and 8.14 per cent respectively at the end of June quarter. 

The bank is hopeful of raising fresh capital by the end of September, to be able to comply with the regulatory capital requirements, said MD & CEO Rakesh Sharma. The bank plans to raise around Rs 9,000 crore by way of private placement, but it has to be done in such a way that LIC’s stake does not fall below 51 per cent, he said. 

Further, it is also banking on stake sale in subsidiaries — IDBI Federal and Mutual Fund. Together, the non-core assets sale is expected to bring in Rs 1,500 crore, Sharma said. 

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