IDBI Bank topples IOB as lender with highest NPA ratio

IDBI Bank's gross NPAs soared to Rs 50,173 crore in the Q1 of 2017-18

Public sector lender IDBI Bank posted a net loss of Rs 853 crore for the quarter ended June 2017 (Q1) on a sharp rise in provisions for bad loans, fall in net interest income (NII) as well as other income. 

The lender’s gross non-performing assets (NPAs) as a percentage of loans was 24.11 per cent, surpassing Chennai-based Indian Overseas Bank’s (IOB’s) 23.6 per cent at the end of Q1, according to a filing with the BSE.

IDBI Bank’s gross NPAs soared to Rs 50,173 crore, or 24.11 per cent of total loans, in the Q1 of 2017-18, from Rs 27,275 crore (11.92 per cent) in the year-ago period. Net NPA was 15.8 per cent, up from 7.47 per cent in the year-ago quarter.

Sequentially, the lender’s slippages were Rs 5,421 crore in Q1. Gross NPA at the end of March 2017 was at Rs 44,752 crore (21.25 per cent). The amount set aside as provisions for bad loans rose by 39 per cent to Rs 1,068 crore in Q1 from Rs 768 crore in the year-ago period. 

The bank had posted net profit of Rs 241.10 crore in Q1 of FY17. Sequentially, it trimmed losses from Rs 3,199 crore in in January-March 2016.

It posted a 17.86 per cent drop on net interest income at Rs 1,402 crore in Q1, against Rs 1,707 crore in Q1 of FY17.

Reeling under bad loans, the Mumbai-based lender is under a prompt corrective action (PCA) plan which puts certain restrictions on business activity. The Reserve Bank of India is monitoring its performance.

Its capital adequacy ratio stood at 10.92 per cent with tier-1 of 7.98 per cent at the end of June 2017.