Corporation Bank Q2 net loss at Rs 1,035 crore on higher provisioning
NEW DELHI: Corporation Bank today reported a net loss of Rs 1,035.20 crore in the second quarter ended September 30, as it parked a sizeable portion of money as provisions against several accounts under insolvency process.
There was a net profit of Rs 206.28 crore during the same period of previous fiscal 2016-17, the state-owned bank said in a regulatory filing.
For NPA accounts under bankruptcy and insolvency proceedings, the bank said it has to make a provision of Rs 1,735.83 crore till March 2018, to be spread over three quarters beginning from the second quarter.
“In terms of directions of RBI, in respect of NPA accounts covered under Insolvency and Bankruptcy Code (IBC), the aggregate provision required for such accounts is Rs 1,735.83 crore.
“Out of this, the bank has provided Rs 924.07 crore during the quarter and balance amount shall be provided by March 31, 2018,” it said in the filing.
The asset quality of the bank worsened with gross non- performing assets (NPAs) hitting 15.28 per cent of the gross loans as on September 30, substantially up from 10.81 per cent by end-September 2016.
Value-wise, gross NPAs reached Rs 20,684.88 crore by end of second quarter, 2017-18; while it was Rs 15,611.06 crore by the same period of 2016-17.
Likewise, net NPAs or bad loans too spiked to 10.24 per cent (Rs 13,082.59 crore) from 6.91 per cent (Rs 9,560.75 crore) during the comparable periods.
The provisions for bad loans and contingencies were raised to Rs 2,668.81 crore for the quarter from Rs 826.81 crore year ago.
Of this, provisions for bad loans alone was at Rs 2,535.95 crore for July-September 2017-18, against Rs 790.01 crore.
Shares of Corporation Bank closed 1.01 per cent up at Rs 45.15 apiece on BSE.
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Via:: Economic Times – Stocks