BoM's Q3 net down by 92%

State owned public sector lender Bank of Maharashtra (BoM) has witnessed a major drop in the profits due to poor recovery of loans and increased staff costs. The bank has reported net profit of Rs 15.85 crore for the year ended December 31, 2013 as compared to Rs 194.06 crore down by 92 per cent over the previous year. Total income for the quarter grew 22.04 per cent to Rs 3307.50 crore as compared to Rs 2710.16 crore.

Gross and Net NPAs as on December 31, 2013 stood at 4.01 and 2.56 percent, respectively, compared to 1.71 and 0.66 per cent, as on December 31, 2012. The bank has recorded portfolio depreciation of Rs 112 crore.

Commenting on results, Sushil Muhnot, chairman and managing director,Bank of Maharashtra, said, "The current slowdown in the economy has badly affected our business. Increased cost of deposits in another reason for decline in the profits. We need to focus on SMEs and MSMEs for which we are offering new products for the recovery. Our aim is to increase profitability. We have spent Rs 300 crore on staff costs and provision of Rs 320 crore for NPAs. We are looking inclusive growth from the SME sector. In the last nine months, Bank's NPA cost has increased form Rs 1137 crore to Rs 3500 crore. But now, we are trying to improve our performance and restructuring the few processes. "

According to Muhnot, larger portion of the NPAs belongs to (55 per cent) infrastructure sector. The bank has received Rs 800 crore equity for the government.