Shares of Lakshmi Vilas Bank (LVB) fell nearly 4 per cent on Wednesday after it reported an 83.4 per cent drop in net profit during the second quarter ended September 30. The bank scrip closed 3.95 per cent lower at Rs 140.95 on the BSE.
The private sector lender’s net profit fell to Rs 10.50 crore for the July-September period due to higher provisioning for bad loans. It had reported a net profit of Rs 64.84 crore in Q2FY17.
Provisioning for bad loans and contingencies jumped to Rs 187.38 crore for the second quarter of 2017-18, as against Rs 62.57 crore in the same period last year.
The bank also made a provision for exposure to the accounts that are facing insolvency proceedings at the National Company Law Tribunal (NCLT). The other provisions were for slippages from the watch list, he said.
In the second quarter of 2017-18, total income of the bank, however, was Rs 902.76 crore compared to Rs 830.29 crore a year ago, the bank said in a regulatory filing.
Asset quality of the bank witnessed a sharp deterioration with gross NPAs rising to 5.50 per cent of the gross advances as on September 30, 2017, from 2.70 per cent at the end of September 2016.
Likewise, net NPAs spiked to 4.33 per cent of the net advances disbursed by the end of second quarter, from 1.87 per cent a year ago. Its capital adequacy ratio (CAR) at the end of September 2017 stood at 10.57 per cent, as against 10.10 per cent a year ago.
Meanwhile, Venkatesh has put in his papers and will take over as the managing director and chief executive of the Mutual Funds Association of India. His last working day with LVB is October 21.