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A look at the March 2020 quarter (Q4) numbers of top private sector banks — HDFC Bank, ICICI Bank, Axis Bank, Kotak Mahindra Bank, and IndusInd Bank — shows that Covid-19 related provisioning has dented their profits.
On a cumulative basis, the Covid provisioning at Rs 8,678 crore has shaved off 45 per cent of their profit before tax (PBT). In other words, had these banks not made the provisions, their combined reported PBT of Rs 10,792 crore would have been higher at Rs 19,740 crore.
Due to a likely deterioration in borrowers’ credit profile, banks were mandated to make
