Bank of India posts net loss of Rs 3,571 crore on extra provisioning in Q4

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Published: June 26, 2020 12:01 AM

Net interest income (NII) during the quarter declined 6.2% y-o-y to Rs 3,793 crore. Similarly, interest margin (NIM) declined by 3 basis points (bps) compared to the same quarter in the last year.

The bank’s provision coverage ratio (PCR) improved to 83.74% at the end of March 2020, compared to 77.2% as of December 2019.The bank’s provision coverage ratio (PCR) improved to 83.74% at the end of March 2020, compared to 77.2% as of December 2019.

Public sector lender Bank of India (BoI) on Thursday reported a net loss of Rs 3,571 crore in the March quarter, against a net profit of `252 crore a year ago, due to Rs 3,700 crore of extra provisioning for two large accounts. The total provisions in the March quarter increased four times to Rs 8,141 crore year-on-year (y-o-y). The lender has provided Rs 414 crore on account of Covid-19. Bank of India has granted moratorium to 41% of customers till now.

Atanu Kumar Das, managing director (MD) and chief executive officer (CEO), Bank of India, said, “We are hopeful that the bank will be back in profit June quarter onward as extra provisioning may not be needed later.”

He specified that the bank has made 10% provisioning in the March quarter itself on account of Covid-19. The Reserve Bank of India (RBI) had earlier mandated banks to provide 10%, which can be spread over two quarters, on account of Covid-19 benefit. The lender has also made additional provision of Rs 271 crore in four accounts, where the viable resolution plan had not been implemented within 180 days of review period.

The bank’s provision coverage ratio (PCR) improved to 83.74% at the end of March 2020, compared to 77.2% as of December 2019.

Net interest income (NII) during the quarter declined 6.2% y-o-y to Rs 3,793 crore. Similarly, interest margin (NIM) declined by 3 basis points (bps) compared to the same quarter in the last year.

The asset quality of the bank had shown good improvement in the March quarter. The gross non-performing assets (GNPAs) declined 152 bps sequentially to 14.78%. Similarly, net NPAs declined 209 bps to 3.88% quarter-on-quarter (q-o-q).

Gross advances went up to Rs 4,16,521 crore as on March 31, 2020, from Rs 3,82,860 crore as on March 31,2019, with a y-o-y growth of 8.79%. The current account savings account (CASA) level increased 8.79% y-o-y to Rs 1,97,751 crore in March 2020 . The CASA ratio stood at 41.5 % in March 2020. The cost to income ratio significantly reduced to 51.6% from 59.22% y-o-y. The bank’s capital adequacy ratio stood at 13.1% at the end of March 31, 2020.

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