Allahabad Bank Q4 net drops 69% to Rs 126 cr on bad loans

Moneycontrol Bureau

Kolkata-based public sector lender - Allahabad Bank's fourth quarter (January - March) net profit plunged nearly 69 percent year-on-year to Rs 126 crore, dented by higher provisions on account of higher non-performing assets. Investors shunned their investments on the bank shares, which dropped nearly 4 percent to about Rs 128 at 13:55 hours.

Net interest income or the difference between interest earned and paid out fell 18 percent Y-o-Y to Rs 1,056 crore. Net interest margin declined 70 basis points quarter-on-quarter to 2.3 percent in fourth quarter.

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Total provisions (inclusive of loans, investments and gratuity fund) shot up 37 percent Y-o-Y to Rs 622 crore. Gross non-performing asset (NPA) ratio stood increased to 3.92 percent compared with 1.83 percent a year back. During the same period, net NPA ratio stood at 3.19 percent versus 0.98 percent bearing evidence of credit quality stress.

In compliance with RBI guidelines on enhanced gratuity provisions for bank employees (rise in ceiling from 3.50 lakh to 10 lakh), the bank charged Rs 8 crore in the profit & loss account. The rest will be amortised over a period of time.

The bank expanded 17 percent Y-o-Y to Rs 1.29 lakh crore. Deposits grew 12 percent Y-o-Y to Rs 1.11 crore.

The loan restructured book stood at Rs 14,875 crore of which Rs 1,970 crore was added during the quarter. State distribution power companies including Rajasthan, Haryana and Uttar Pradesh contributed to the rise of loan restructuring.

saikat.das@network18online.com