IDBI Bank Q1 loss widens to Rs 3,801 crore
Mumbai: Life Insurance of Corporation of India (LIC)-owned IDBI Bank net losses widen to Rs 3,801 crore in the quarter ended June on higher provision for NPAs.
The bank had reported a net loss of Rs 2,410 crore in the same quarter of the last year.
"As we had to make higher provisions for NPA there was a net loss of Rs 3,801 crore during the quarter," its managing director and chief executive Rakesh Sharma told reporters. Its provision for NPAs stood at Rs 7,009 crore as against Rs 4,603 crore in the year-ago period.
"There were two accounts worth over Rs 2,000 crore from the power sector-owned by Navratna company that RBI had asked us to downgrade and because of that some additional Rs 1,200 crore of provision we had to make. We are quite sure that these two accounts will be upgraded within a year or so," Sharma said.
Total provision stood at Rs 4,752 crore as against Rs 3,491 crore. Net interest margin were at 2.13 per cent as against 2.17 per cent. Gross NPA ratio improved to 29.12 per cent as against 30.78 per cent, while net NPA ratio improved to 8.02 per cent from 18.76 per cent as on June 30, 2018.
It expects to bring net NPA to below 6 per cent by September quarter. The bank's recovery from NPAs stood at Rs 729 crore.
Fresh slippages were at Rs 3,486 crore, it said.
"Except these two accounts where slippages had to be downgrade, the slippages were well within the limit which we had prescribed," Sharma said adding the bank has set a recovery target of Rs 12,000-13,000 crore in FY20.
It is also planning to raise Rs 3,000-3,500 crore of NPAs to asset reconstruction companies during the year.