Public sector lender Allahabad Bank on Friday reported a standalone net loss of Rs3,509.63 crore for the last quarter ended March of 2017-18 due to more than three-time rise in its provisions for bad loans.
The bank had registered a net profit of Rs111.16 crore in the same quarter of preceding fiscal 2016-17. The bank had reported a loss of Rs1,263.79 crore in the previous December quarter. The provisioning for bad loans spurted to Rs5,126 crore during the March quarter against Rs1,489.88 crore in the year-ago quarter, according to the regulatory filing by the bank.
Income during the quarter also fell to Rs4,259.37 crore from Rs5,105.07 crore as also interest income declined to Rs3,776.81 crore from Rs4,372.18 crore in January-March 2017. For the entire 2017-18, net losses widened to Rs4,674.37 crore from Rs313.51 crore in 2016-17.
Total income declined to Rs19,051.05 crore in FY2017-18 from Rs20,304.72 crore in the previous fiscal. On consolidated basis, the full year net loss rose to Rs4,574.22 crore from Rs279 crore year ago. Income decreased to Rs19,487.51 crore from Rs20,578.94 crore in FY2016-17.
The provisioning amount for NPA for the year grew to Rs10,326.45 crore from Rs4,552.37 crore year ago fiscal. The bank said it has not declared any dividend for financial year 2017-18. The bank’s non-performing assets (NPAs) reached 15.96% of gross advances by end of March 2018 from 13.09% in year ago same period.
Gross bad loans were to the tune of Rs26,562.79 crore as of March 2018 against Rs20,687.83 crore in March 2017. Net NPA ratio, however, fell to 8.04% (Rs12,229.13 crore) from 8.92% (Rs13,433.51 crore).
Allahabad Bank said the board of directors have approved raising of equity capital aggregating up to Rs1,900 crore through various modes. The Kolkata-headquartered lender said that is has merged its wholly owned subsidiary AllBank Finance Ltd with itself with effect from 14 March 2018.
Among others, it said the bank reported 43 fraud cases in 2017-18 involving a total amount of Rs1,525.35 crore. “Out of these accounts, the bank has recovered a total amount of Rs 2.76 crore and made a total provision for balance amount of Rs 1,522.59 crore during the year. The quantum of unamortised provision debited from ‘other reserves’ as at the end of year amounting to Rs 390.58 crore in pursuance to RBI norms...as the provision for fraud can be amortized over a period of four quarters,” the bank said.
Besides, in respect of two gems and jewellery borrower groups, where fraud was declared by some banks, Allahabad Bank has fully provided for the entire funded exposure, it said. Also, the bank said it has made additional provision of Rs672.61 crore as on 31 March 2018 in respect of certain NPA accounts covered under the provisions of Insolvency and Bankruptcy Code (IBC).
On the divergence on asset classification and provisioning for NPAs as per RBI’s risk assessment report (RAR), the lender has shown a gap of Rs1,077.80 crore in gross NPA for 2016-17; for net NPAs it is Rs925.40 crore.
The bank had reported a net loss of Rs313.52 crore in 2016-17, however, taking into account the Rs152.40 crore divergence in provisioning, the adjusted net loss for the said fiscal comes in at Rs465.92 crore.
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