Q1 review: Provisions cut into profit of pvt banks, asset quality a problem

Total gross NPA ratio for private banks during the quarter stood at 4.5 per cent, against 4.06 per cent in the April-June 2017 period

IIt was a mixed bag for private banks in the first quarter (Q1) of 2018-19 (FY19). While ICICI Bank posted its first-ever loss and Axis Bank’s net profit reduced to half as against the previous year’s, other private banks showed a healthy trend. 

Provisioning for bad loans continued to weigh on the banks’ profitability along with losses in the bond portfolio as well as slower income growth.

According to a CARE Ratings report, the total net profit of private sector banks declined 18.8 per cent year-on-year (YoY) in the June 2018 quarter, against a rise of 13.3 per cent YoY in the