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State-owned Indian Overseas Bank (IOB) on Friday reported a net profit of Rs 148 crore for the second quarter of present fiscal as bad loans and provisions declined.
The Chennai-headquartered lender had registered a net loss of Rs 2,254 crore in July-September quarter a yr in the past.
Sequentially, net profit grew 22.three per cent from Rs 121 crore in June quarter of this fiscal.
Total earnings rose 8.1 per cent to Rs 5,431 crore in the course of the quarter beneath evaluation as towards Rs 5,024 crore in the identical quarter of 2019-20, Indian Overseas Bank (IOB) stated in a regulatory submitting.
Interest earnings elevated to Rs 4,363 crore from Rs 4,276 crore a yr in the past.
There was a considerable enchancment in financial institution’s asset high quality as the gross non-performing assets (NPAs) plunged to 13.04 per cent of the gross advances as of September 30, 2020 from 20 per cent on the finish of September 2019.
In worth phrases, gross NPAs or bad loans fell to Rs 17,659.63 crore as towards Rs 28,673.95 crore a yr in the past.
Net NPAs lowered to 4.30 per cent (Rs 5,290.60 crore) from 9.84 per cent (Rs 12,507.97 crore) a yr in the past.
Total contemporary slippages (different debits to current NPA accounts) for September quarter had been contained at Rs 292 crore, the lender stated.
“Total cash recovery for September 2020 was Rs 513 crore (including cash recovery) as against Rs 172 crore in June 2020,” it stated.
Provisions for bad loans and contingencies fell to Rs 1,192.55 crore in the course of the quarter beneath evaluation from Rs 2,996.04 crore put aside in the year-ago quarter.
IOB stated it has made required provisioning in advances in particular accounts so as to enhance net NPAs.
The financial institution’s gross advances fell to Rs 1,35,469 crore as of September 30, 2020 from Rs 1,43,350 crore a yr in the past. However, it was barely increased from Rs 1,31,565 crore on the finish of June 2020.
“The bank has evolved a policy of not taking fresh exposures in stressed sectors, below hurdle rated accounts and BB and below rated accounts. The bank has also exited from accounts in the stressed sectors, wherever feasible,” it stated.
The financial institution has grown beneath retail and agri sector and re-balanced the advance steadiness by consciously decreasing the harassed sector in company section, it added.
Provision protection ratio improved to 89.36 per cent on the finish of September 2020 as towards 75.85 per cent on the finish of September 2019.
IOB’s common price of deposit lowered to 4.89 per cent from 5.41 per cent, whereas net curiosity margin improved to 2.18 per cent for the quarter as towards 1.86 per cent in the year-ago interval.
The financial institution stated on leisure of COVID-19 associated lockdowns, it began mega e-auction course of pan-India on the market of properties.
The first such e-auction was carried out, fetching countable restoration by sale of properties and such e-auctions are deliberate to be carried out each month like in 2019-20, IOB stated.
Shares of IOB on Friday closed 0.72 per cent decrease at Rs 9.65 apiece on the BSE.
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