STOCK MARKET BSE NSE

IDBI Bank to set off Rs 45,586-crore accumulated losses against balance in securities premium account

LIC-controlled IDBI Bank will set off its accumulated losses worth Rs 45,586 crore against the balance in the securities premium account.

Published: 01st March 2021 07:54 PM  |   Last Updated: 01st March 2021 07:55 PM   |  A+A-

IDBI Bank

IDBI Bank

By PTI

NEW DELHI: LIC-controlled IDBI Bank will set off its accumulated losses worth Rs 45,586 crore against the balance in the securities premium account, according to the bank's draft scheme.

Its accumulated losses (or debit balance of profit or loss account) at the end of March 31, 2020, stood at Rs 45,586 crore.

And, they were at Rs 44,739 crore as on December 31, 2020.

The accumulated losses as at March 31, 2021, shall be ascertained after the audited financial statements are approved by the bank's board, said the lender, as per the draft scheme addressed to its shareholders for setting off the accumulated losses.

The bank's authorised share capital is Rs 25,000 crore.

The issued, subscribed and paid-up share capital is worth Rs 10,752.40 crore and the security premium is of Rs 50,732.27 crore.

IDBI Bank said the balance standing to the credit of securities premium account of the bank as per audited financial statements for FY20 and as on April 1, 2020, is Rs 49,669 crore.

The said the balance as on December 31, 2020, stood at Rs 50,718 crore as per the unaudited financial statements.

"The balance standing to the credit of securities premium account as on March 31, 2021, shall be ascertained after the audited financial statements are approved by the board of directors of the bank," it added.

Last month, its board had approved a proposal of setting off the lender's accumulated losses by April 1, 2021, in full or partially, by using the balance in the securities premium account.

Giving reasons for the move, the lender had said the accumulated losses have wiped off its value represented by the share capital.

"In view of the accumulated losses, the distributable items, in terms of RBI's notification dated February 2017, are negative, and the bank is not eligible to make coupon payment of AT (additional tier)-1 bonds," it had said.

This is affecting the bank's plan to raise AT1 bonds in the near future, it said adding that it believes reducing the share capital is the most practical and economically efficient option so as to present a true and fair view of the financial position of the bank.

Representation of true value would benefit members as their holding will yield better value and also enable the bank to explore opportunities to benefit the members, including in the form of dividend payout within a reasonable timeframe, IDBI Bank had said.



Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp