IDBI Bank posts huge Q4FY18 loss

State-owned bank IDBI Bank on Friday reported huge losses at the end of the March quarter after setting aside funds to cover rising bad loans.

The IDBI Bank reported a net loss of Rs8,157.11 crore for the fiscal third quarter after its provisions doubled to Rs10,773.30 crore from Rs3,637.49 crore at the end of December 1.
The bank reported a net loss of Rs5,662.76 crore in the March quarter compared to Rs1,524.31 crore during the same quarter in the previous year.
The bank’s gross non performing assets rose to 27.95% compared to 24.72% at the end of December quarter.
In a post results press conference. MK Jain, managing director & chief executive officer, said that the bank has identified Rs21,397 crore worth of bad loans to be put up for sale, which includes 30 large corporate accounts. He also said that the bank has added fresh bad loans worth Rs12,823 crore in the fourth quarter.
“Most of the legacy issues on asset quality has been recognised. We hope to turnaround by the end of the financial year, on the back of IBC resolutions,” Jain said.The rise in bad loans was because of a Reserve Bank of India (RBI) review which revealed a divergence in reporting of gross NPAs based on fiscal 2017 results. Such divergence—the difference between RBI’s assessment and that reported by the lender—was around Rs10,281 crore at the end of March 2017.

The bank’s net interest income (difference between interest earned and paid) declined by 43.9% to Rs915.47 crore in the January to March quarter 2018, as compared to Rs1,633.3 crore in the same quarter in 2017.

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