OBC Q2 net slips 17% to Rs 251 cr on higher provisions

Moneycontrol Bureau

Public sector lender Oriental Bank of Commerce's (OBC) second quarter (July-September) net profit fell 17 percent year-on-year to Rs 251 crore, impacted by higher provisions while asset quality deteriorated further.

Net interest income (the difference between interest earned and expended) increased 10.7 percent on yearly basis to Rs 1,281 crore in three-month period ended September 2013.

Provisions and contingencies climbed 3.3 percent sequentially (up 19.7 percent year-on-year) to Rs 550.5 crore in the quarter gone by.

Gross non-performing advances (NPA) as a percentage of gross advances rose 41 basis points Q-o-Q (up 85 basis points Y-o-Y) to 3.77 percent while net NPAs as a percentage of net advances jumped 35 bps Q-o-Q (up 65 bps Y-o-Y) to 2.69 percent during July-September quarter.

In absolute terms, gross NPAs increased 13.6 percent Q-o-Q (up 41 percent Y-o-Y) to Rs 4,887.12 crore while net NPAs surged 16.6 percent Q-o-Q (up 43 percent Y-o-Y) to Rs 3,422.86 crore in September quarter.

Capital adequacy ratio (as per Basel III) expanded to 11.43 percent from 10.97 percent sequentially.

Meanwhile, the board of directors of the company today approved the proposal regarding raising of capital by way of preferential allotment of equity shares in favour of Government of India amounting to Rs 150 crore.

At 12:56 hours IST, the stock was down 2.25 percent to Rs 156.20 on the BSE.