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Public sector lender Oriental Bank of Commerce (OBC) is expected to report profit at Rs 119.4 crore in Q2, down 60.4 percent compared with Rs 301 crore in year-ago period.
Slippages for the Q1 were Rs 3,464 crore, which are mostly from the iron & steel and textile industries, says Animesh Chauhan, MD & CEO of OBC. Total slippages from the restructured books stood at near Rs 1,500 crore.
Gross non-performing asset (NPA) below 10 percent will be positive
Slippages for this quarter has been Rs 4,019 crore, Animesh Chauhan, MD & CEO of Oriental Bank of Commerce told CNBC-TV18.
Speaking to CNBC-TV18, Animesh Chauhan, MD & CEO of the bank says three accounts were put under RBI‘s 5/25 rule and 9 accounts worth Rs 1,500 were added under strategic debt restricting (SDR).
Animesh Chauhan, MD and CEO of Oriental Bank of Commerce says the bank's slippages have declined to Rs 770 crore versus Rs 1600 crore quarter-on-quarter (QoQ).
Chauhan tells CNBC-TV18 that profitability should be good as the net interest income and net interest margin of the bank is improving.
The bank incurred one-time loss of Rs 280.40 crore in the quarter as it sold Rs 395.33 crore of loans to asset reconstruction companies (ARCs).
Overall numbers of OBC look decent, says Vaibhav Agrawal of Angel Broking. The higher provisioning has enabled the bank to bring down its net NPA, he says.
Animesh Chauhan, MD & CEO, OBC talks about the bank‘s performance in the third quarter.
Vaibhav Agrawal, VP - research banking, Angel Broking says on the asset quality front, the numbers were especially disappointing. Slippages must have been high, he adds.
Nischal Maheshwari, Head of Research, Edelweiss Securities is positive on Allahabad Bank and OBC from the banking pack and sees them performing well in the future.
Darpin Shah of HDFC Securities said that while the increase in gross NPA and fall in adjusted profits for Oriental Bank of Commerce was disappointing, the stock was still compelling from a valuation perspective, and that we would maintain a ‘buy‘ as of now, subject to further details emanating from the numbers.
In an interview to CNBC-TV18, Suresh N Patel, ED, Oriental Bank of Commerce, discusses the bank‘s results and its plans ahead.
Net interest income is seen falling 2 percent to Rs 1,257.5 crore in the quarter ended September 2014 compared to Rs 1,281 crore in same quarter last year.
Nilesh Parikh Edelweiss Financial Services recommends buying OBC given its valuations.
SL Bansal of OBC believes it is difficult to pass on the increased lending rate to the customer as it will cause a lot of stress on the borrower.
The CNBC-TV18 poll of analysts expect net interest income to rise 9 percent to Rs 1,309 crore from Rs 1,204.4 crore and profit after tax may fall 25 percent to Rs 244 crore from Rs 326.4 crore year-on-year.
Siddharth Teli believes Bank of Baroda is good bet in the PSU banking space as there has been some upgrade in the earnings and there is a possibility of an uptick in margins going ahead.
OBC's SL Bansal expects the public sector lender to grow around 14 percent in FY14. The bank is unlikely to raise its lending rates in the next 45 days as that will hurt its profit required to sustain in the long-run, he adds.
According to Motilal Oswal, Oriental Bank of Commerce's NII is expected to decrease by 1.2 percent Q-o-Q (up 11.6 percent Y-o-Y) to Rs 1,291.2 crore.
Cash flows are under a lot of pressure which has resulted in a slight increase in gross NPA and net NPA, says OBC CMD SL Bansal. Meanwhile, the bank aims to maintain net interest margin in the range of 2.85-2.87 percent ahead.
B Nayyar, ED, Oriental Bank of Commerce (OBC) says, in an interview to CNBC-TV18, that the balance-sheet has been strengthened with 63-percent provisioning and adds that a 25-bps cut in deposit rates is likely.
Oriental Bank of Commerce is to announce its fourth quarter results. According to CNBC-TV18's estimates, the company's Q4 profit after tax (PAT) is seen up 25 percent to Rs 330 crore versus Rs 265 crore, Y-o-Y.
Motilal Oswal has come with its March`13 quarterly earning estimates for financial sector. The research firm expects reforms and monetary easing to continue, thereby growth is expected to revive gradually.