Private sector lender Axis Bank has reported a net loss of ₹112.08 crore in the second quarter of the fiscal due to one time adjustment of deferred tax assets as it chose to take the benefit of the reduction in corporate tax rates.
It had posted a net profit of ₹789.61 crore in the July to September 2018 quarter.
“Net loss of ₹112 crore for the quarter, driven by a one-time tax impact of ₹2,138 crore due to changes in corporate tax rate. Excluding this extraordinary item, profit after tax would have been ₹2,026 crore, up 157 per cent year on year,” Axis Bank said in a release on Tuesday.
The bank’s total income grew by a robust 21.1 per cent to ₹19,333.57 crore in the second quarter of the year from ₹15,959.37 crore a year ago.
Net interest income increased 17 per cent annually to ₹6,102 crore in the quarter under review. The net interest margin at 3.51 per cent was the highest in nine quarters.
Other income shot up by 45.4 per cent to ₹3,895.77 crore in the quarter ended September 30. Fee income also increased by 11 per cent year on year, led by retail fees that increased by 16 per cent.
Its provisions increased by 20 per cent to ₹3,518.39 crore in the second quarter.
Provision Coverage Ratio of the bank improved to 79 per cent from 78 per cent. “The bank also holds ₹2,600 crore of provisions towards various contingencies,” it said.
The bank’s asset quality also improved. “Gross and net non performing assets book both fell for the sixth straight quarter,” it said.
Gross non-performing assets fell to ₹29,071.97 crore in second quarter from ₹30,938.33 crore a year ago. Net non-performing assets were also lower at ₹11,138.30 crore as on September 30, 2019 from ₹12,715.71 crore a year ago.
GNPA and NNPA ratios were 5.03 per cent and 1.99 per cent at the end of the second quarter in 2019-20, compared to 5.96 per cent and 2.54 per cent on September 30, 2018.
Loan book grew by ₹24,318 crore on a quarterly basis, which is largest growth in the last eight quarters, Axis Bank said, adding that total deposits on quarterly average basis grew 23 per cent year on year.
Axis Bank scrip closed 0.49 per cent higher at ₹712.70 apiece on BSE.