Comments
Our Bureau
Private sector lender Federal Bank on Wednesday posted a 43.5 per cent fall in its net profit for the quarter ended March 31, 2018, with a sharp spike in its provisions for bad loans.
The bank’s standalone net profit fell to ₹144.9 crore in the fourth quarter of last fiscal compared to a healthy ₹256.59 crore a year ago.
Its net profit for 2017-18 saw a marginal increase of 5.8 per cent at ₹878.8 crore against ₹830.7 crore in 2016-17. The lender’s consolidated net profit rose 6.6 per cent last fiscal at ₹909.6 crore. Its provisions for bad loans shot up by over 200 per cent at ₹371.5 crore in the fourth quarter of last fiscal compared to ₹ 122.7 crore in the same period a year ago.
The bank’s bad loans jumped 62 per cent and gross non-performing assets (NPAs) touched ₹2,795.6 crore as on March 31, 2018, compared to ₹1,727 crore a year ago.
Gross NPAs as a per cent of gross advances also rose steadily to 3 per cent by the end of the fourth quarter of 2017-18 from 2.52 per cent in the third quarter, and 2.33 per cent in the fourth quarter a year ago.
Net NPAs, or bad loans, were 1.69 per cent of net loans in the quarter under review against 1.28 per cent a year ago.
Total income during the quarter ended March 31, 2018, rose to ₹2,862.14 crore against ₹2,598.06 crore in the same period of 2016-17. The bank said it has not taken advantage of the Reserve Bank of India’s recent circular to spread provisioning for mark-to-market losses. “The bank has recognised the entire mark-to-market loss on investments in the respective quarters,” it said.
With the increase in gratuity ceiling to ₹20 lakh, the lender has decided to spread the incremental expenditure of ₹714.3 crore over four quarters.
It has charged ₹178.5 crore to the profit and loss account for the quarter ended March 31, 2018. Federal Bank’s board has recommended the payment of final dividend of ₹1 per share for the fiscal after approval from shareholders.
The bank’s scrip fell 2.27 per cent to close at ₹101.15 apiece on the BSE.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.