Indian Overseas Bank chief Sekar expects bank to turn profitable in March quarter

By: |
Published: February 13, 2020 7:42:50 AM

The bank, which posted a loss of over Rs 6,000 crore in the December quarter, expects to grow at 5-10% in the coming financial year.

IOB, BANKING SECTORKarnam Sekar

Indian Overseas Bank (IOB) hopes to turn profitable in the March quarter after posting losses for over four years, said Karnam Sekar, managing director and CEO. “In the January-March 2020, we will be in profit. Our slippages are almost over. March 2020 corporate slippages are almost negligible. The RAM (retail, agriculture and MSME) sector slippages are under control,” Sekar said.

IOB’s management hopes that the bank will be out of the central bank’s Prompt Corrective Action (PCA) framework during the next financial year. “Net NPA is 5.81% as on December, so it is less than 6%. That is one of the requirements for coming out of PCA, which we have achieved in December. In March, we will be in profit also. And those two are the main criteria. We are sure (of coming out of PCA in FY21),” Sekar told reporters.
The stressed state-owned bank may see repayments worth `1,000 crore during the March quarter from the resolution of several corporate accounts, including Bhushan Power & Steel, Sekar said. “IOB’s main problems are from the corporate sector. That is more or less addressed now, and for many more quarters to come, we don’t see any corporate account which is likely to slip,” Sekar said.

The bank, which posted a loss of over Rs 6,000 crore in the December quarter, expects to grow at 5-10% in the coming financial year. The bank’s loss during the quarter was amplified by provisions for bad assets more than doubling to `6,633.9 crore. Stressed DHFL was recognised as a non-performing asset by the bank during the December quarter, Sekar said.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1Mutual Funds’ investments HFCs, NBFCs see steep fall
2Yes Bank to delay Q3 results till mid-March, says management ‘deeply engaged’ in fundraising
3Banks should ‘deeply involve’ those under ambit of formal financial system, says President Ram Nath Kovind