Higher provision towards bad loans and depreciation on investments widened IDBI Bank’s net loss in the third quarter. It reported a net loss of ₹2,255 crore in the reporting quarter ended December 31, 2016, as against ₹2,184 crore in the year-ago period.

Net interest income (the difference between interest earned and interest paid) was down 45 per cent in the reporting quarter at ₹850 crore (₹1,556 crore in the year-ago quarter).

Non-interest income was down 5 per cent to ₹551 crore (₹578 crore).

In the reporting quarter, provision towards bad loans rose to ₹2,357 crore (₹1,715 crore). Provision towards depreciation in investments jumped to ₹496 crore (₹71 crore).

That the public sector bank is up against asset quality challenges is underscored by the fact that it reported fresh slippages of ₹6,220 crore in the reporting quarter. Gross non-performing assets (GNPAs) rose from ₹30,134 crore as at September-end 2016 to ₹35,245 crore as at December-end 2016.

In percentage terms, GNPAs rose to 15.16 per cent of gross advances as at December-end 2016 as against 8.94 per cent as at December-end 2015.

Margins down Net interest margin (net interest income/ total assets) was down to 0.90 per cent in the reporting quarter as against 1.98 per cent in the year-ago quarter.

While gross advances inched up 6 per cent year-on-year (y-o-y) to ₹2,32,552 crore (₹2,19,393 crore as at December-end 2015), deposits grew 27 per cent y-o-y to ₹2,98,194 crore (₹2,34,691 crore).

Thanks to deposit inflows during the 50-day demonetisation period, the bank was able to increase the low-cost current account, savings account (CASA) deposits to 28.39 per cent of total deposits from 25 per cent in the year-ago quarter.

IDBI Bank shares closed at ₹81.75 apiece, down 2.15 per cent over the previous close on the BSE.

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