Bank of India hits 52-week low post June quarter results

The stock dipped almost 5% to Rs 156 after the bank reported a lower-than-expected net profit of Rs 130 crore in the June quarter.

Shares of Bank of India dipped almost 5% to Rs 156, their fresh 52-week lows on the National Stock Exchange (NSE), after the bank reported a lower-than-expected standalone net profit at Rs 130 crore for the quarter ended June 30, 2015 (Q1), due to higher provisioning for bad loans.

The government-owned bank had posted a profit of Rs 806 crore in the same quarter last year. It had reported a net loss of Rs 56 crore in the March 2015 quarter.

The bank’s net interest income (interest earned minus interest expended) during the quarter under review, however, grew 8.5% to Rs 2,913 crore against Rs 2,686 crore in the corresponding quarter of previous fiscal. Provisions other than tax increased 70% to Rs 1,515 crore over the previous year's corresponding quarter.

Analysts on an average had expected profit of Rs 306 crore on net interest income of Rs 2,912 crore.

Asset quality of the bank has worsened on a sequential as well as yearly basis. Gross non-performing assets (NPA) as percentage of gross advances rose to 6.80% in the June 2015 quarter from 5.39% in the March 2015 quarter and 3.28% in the June 2014 quarter.

The bank's net NPAs during the quarter stood at 4.11% compared to 3.36% in the previous quarter and 2.14% in last year's corresponding quarter.

The stock erased most of its losses and is trading lower by less than 1% at Rs 162 on the NSE at 01:03 hours. A combined 6.78 million shares have changed hands on the counter on the NSE and BSE so far.