Indian Bank has posted a 59 per cent drop in its net profit to Rs 84.5 crore for the quarter ended March, from Rs 206.1 crore in the corresponding quarter last year.Total income increased to Rs 4,513.6 crore, from Rs 4,410.5 crore for the quarter ended March 31, 2015.
The bank’s gross non-performing assets (NPAs) rose to Rs 8,827 crore, from Rs 5,670.4 crore. In percentage terms, it rose to nearly 6.6 per cent, from 4.4 per cent a year ago. Net NPA rose to Rs 5,419.4 crore from Rs 3,146.9 crore. In percentage terms, it was increased to 4.20 per cent from 2.50 per cent.
"There are additional provisions. The slippage is Rs 3,368 crore from the previous year figure, which was around Rs 800-900 crore. Obviously there was provision. But the important factor is operating profit, which has increased from the previous year figure," said Mahesh Kumar Jain, managing director and chief executive of Indian Bank.
In tune with the RBI directive on the asset quality review (AQR) and others, the loans under stress related to the inherent weakness in certain sectors and accounts, were identified as NPA. The stressed sectors are power, textile, iron and steel etc.
"As far as the major stressed sectors are concerned, the balance sheet is clean. From April, our business is as usual,"
The board has discussed the future course of the Bank and decided to position Indian Bank as mid sized bank with focus on retail and mid corporate segment. It will launch separate verticals for mortgage loan including housing loan, for MSME and Other retail for financial inclusion verticals. These verticals will have COOs appointed from outside and dedicated branches, while the existing banks would generate the lead as per the target assigned by the management.
During the fourth quarter, we have sold Rs 1106 crore assets which were over and above the book value.
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