Moneycontrol Bureau
Shares of Bank of India fell 4.7 percent intraday Thursday after rating agency Standard & Poor's lowered bank's standalone credit profile to BB+ from BBB-.
The rating agency expects bank's asset quality to remain weak over the next 12 months.
However, S&P has affirmed BBB- long-term and A-3 short-term issuer credit ratings. "Long-term ratings affirmed due to continued expectations of government support," it said in its note.
Asset quality of the bank deteriorated during January-March quarter of FY15. Gross non-performing assets (NPA) increased 132 basis points sequentially (up 224 bps year-on-year) to 5.39 percent. Net NPA climbed 88 basis points (up 136 bps Y-o-Y) to 3.38 percent in the quarter gone by.
The state-run lender had posted a loss of Rs 56.1 crore in the quarter ended March 2015 against profit of Rs 557.5 crore in the year-ago period despite tax writeback of Rs 773 crore. Higher provisions, lower operating profit and net interest income dented the bottomline but other income supported.
Provisions for bad loans spiked 45.7 percent (up 42.7 percent quarter-on-quarter) to Rs 2,255.5 crore during March quarter compared to Rs 1,547.3 crore in the corresponding quarter of last fiscal.
At 09:35 hours IST, the scrip of Bank Of India was quoting at Rs 182.95, down Rs 6.95, or 3.66 percent after hitting a 52-week low of Rs 181.05 on the Bombay Stock Exchange.
Posted by Sunil Shankar Matkar
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