IDBI Net Dips To Rs 325 Cr On Dabhol Provisioning

Mumbai, April 29 | Updated: Apr 30 2004, 05:30am hrs
Increased provisioning for bad and doubtful debts mainly on account of the Dabhol Power project and investments, have pulled down the net profit of the Industrial Development Bank of India (IDBI) by 18.95 per cent to Rs 325 crore in 2003-04. IDBI has provided for both the phases of DPC though it believes that phase-II of the project is still one under implementation.

The bank which is in the process of converting itself to a bank by June 2004 has gone for a higher provisioning amounting to Rs 1,540 crore, up by 38 per cent during 2003-04 from Rs 1,110 crore which was provided against sticky assets in 2002-03. In the fourth quarter of 2003-04, the banks provisioning against bad debts went up by 37 per cent to Rs 615 core.

After making a tax provision of Rs 11 crore and factoring in deferred tax credit of Rs 31 crore, the net profit of the bank has fallen to Rs 102 crore in the fourth quarter of 2003-04 (Rs 209 crore).

IDBIs board on Thursday decided to extend the accounting period for 2003-04 by six months upto September avoiding the closing and balancing of its books of account twice over, once on March and again on the appointed date of conversion of IDBI into a banking company.

Aggregate assets of the bank increased by six per cent at Rs 66,921 crore. On the business outlook, IDBI said the operating environment was conducive for facilitating an improvement in the banks performance and quality of its portfolio during 2004-05.

IDBIs total income was higher by 39.64 per cent at Rs 6,978 crore for the period under review as compared to Rs 4,997 crore in 2002-03. IDBI said aggregate sanctions including funded interest term-loans aggregated Rs 5,631 crore for 2003-04 as compared to sanctioned volumes of Rs 5,898 crore in the preceding fiscal.

IDBIs disbursements dropped during the same period clocking Rs 4,409 crore (Rs 6,615 crore). Income from treasury operations more than double at Rs 576 crore (Rs 228 crore), it indicated, adding that the size of funds managed multiplied from Rs 1,700 crore (Rs 10,379 crore).

IDBI said sanctions to the infrastructure sector moved up steeply by 288.2 per cent while disbursements rose by 15.2 per cent accounting to 43.9 per cent and 34 per cent of total sanctions and disbursements respectively during this period.