Money & Banking

IDBI Bank posts first full-year profits in 5 years at ₹1,359 cr in FY21

Our Bureau Mumbai | Updated on May 03, 2021

Sees robust 37.5 per cent increase in net interest income

After five years, IDBI Bank is back in the black, reporting a full-year standalone net profit of ₹1,359 crore in FY21 against a net loss of ₹12,887 crore in FY20.

In the fourth quarter of FY21, the Bank’s standalone profit soared almost four times to ₹512 crore against ₹135 crore in the year-ago period.

The profitability in the reporting quarter was supported by a robust 37.5 per cent increase in the net interest income, a ₹300- crore write back of provision for tax, and a write-back of ₹ 1,120 crore in bad loan provisions.

The net interest income (the difference between interest earned and expended) rose to ₹3,240 crore (₹ 2,356 crore in the year ago quarter).

Non-interest revenues, comprising fee-based, trading and other incomes, were down 11 per cent year-on-year (yoy) at ₹1,181 crore (₹ 1,326 crore).

Rakesh Sharma, MD & CEO, said that with the Bank out of the Prompt Corrective Action framework, there is no restriction on lending to large and mid-level corporates now. Advances had contracted by 6 per cent y-o-y in FY2021.

Accelerates provisions

In the reporting quarter, the Bank’s overall, the provisions rose 36 per cent y-o-y to ₹ 2,367 crore (₹ 1,738 crore).

The gross non-performing assets (NPA) position improved to 22.37 per cent of gross advances against 27.53 per cent in the year ago quarter. Net NPAs declined to 1.97 per cent of net advances against 4.19 per cent.

Sharma expects credit cost and slippage ratio to be below 1.5 per cent and 2 per cent, respectively, on a sustained basis.

By the Bank’s projections, the net NPA level will be maintained below 3 per cent till March 2022 and 2.5 per cent thereafter.

As at March-end 2021, total deposits increased by 4 per cent yoy to ₹ 2,30,898 crore and total advances were down 6 per cent yoy to ₹ 1,61,901 crore.

Published on May 03, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

  1. Comments will be moderated by The Hindu Business Line editorial team.
  2. Comments that are abusive, personal, incendiary or irrelevant cannot be published.
  3. Please write complete sentences. Do not type comments in all capital letters, or in all lower case letters, or using abbreviated text. (example: u cannot substitute for you, d is not 'the', n is not 'and').
  4. We may remove hyperlinks within comments.
  5. Please use a genuine email ID and provide your name, to avoid rejection.