Bank of India posts Rs 3,571 cr loss in Q4 as provisions rise

Bank of India on Thursday reported a standalone net loss of Rs 3,571 crore for March quarter 2019-20, as it made higher provisions for bad loans. The state-owned lender reported a profit after tax of Rs 252 crore for the year-ago same period. “The loss was mainly because of the aggressive provisions we made over and above the required norms.

Bank of India on Thursday reported a standalone net loss of Rs 3,571 crore for March quarter 2019-20, as it made higher provisions for bad loans. The state-owned lender reported a profit after tax of Rs 252 crore for the year-ago same period.

“The loss was mainly because of the aggressive provisions we made over and above the required norms. For two major accounts – one NBFC and another housing finance company- we decided to provide 100 per cent, which amounted to Rs 3,700 crore,” Managing Director and CEO A K Das told reporters.       The lender made a provision of Rs 414 crore, which is 10 per cent of the balance outstanding in respect of special mention accounts (SMA) where the moratorium was extended, as against the minimum requirement of 5 per cent. Das said of the 56 lakh eligible accounts, nearly 41 per cent of customers opted for the moratorium and in terms of value, 46 per cent of the bank's book is under moratorium as of March 31.        For the full year, the bank reported a standalone net loss of Rs 2,957 crore as against a loss of Rs 5,547 crore in 2018-19. In the last financial year, the lender made a provision of Rs 14,416 crore for NPAs.

Das said the bank will likely turn profitable in the June quarter as all the pain areas including additional provisioning have been addressed. Domestic net interest margin (NIM) stood at 3.18 per cent as against 3.38 per cent in the year-ago period.

Gross non-performing assets improved to 14.78 per cent from 15.84 per cent, while net NPA stood at 3.88 per cent as against 5.61 per cent. Provision coverage ratio jumped to 83.75 per cent in March quarter 2020 from 76.95 per cent a year ago.

Fresh slippages reduced to Rs 2,764 crore from Rs 3,102 crore in the same quarter last year. The bank recovered Rs 1,279 crore of loans during the last quarter of 2019-20.

The CRAR (Basel III) stood at 13.10 per cent at March-end 2020 against 14.19 per cent in March 2019. Gross domestic advances increased by 9 per cent to Rs 3,57,670 crore and deposits rose 14.40 per cent to Rs 4,82,539 crore as on March 31, 2020.

It expects a credit growth of 8-9 per cent in the current fiscal. The bank's scrip ended 8.20 per cent down at Rs 50.40 on BSE on Thursday.