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Indian Overseas Bank trims Q1 loss to Rs 499 cr

Press Trust of India  |  New Delhi 

State-owned (IOB) today reported narrowing its losses to Rs 499.09 crore in the first quarter ended June as provisions for bad assets were reduced.

There was a loss to the tune of Rs 1,450.50 crore during the corresponding April-June quarter of fiscal ended March 2017.

Total of the also fell to Rs 5,174.50 crore during the three months to June this fiscal, as against Rs 5,868.44 crore on account of reduction in interest rates, the said in a regulatory filing.

Despite a downsizing of the NPA provisions, the bank witnessed a year-on-year spike in its bad assets proportion during the first quarter of current fiscal 2017-18.

Gross non-performing assets (NPAs), as a percentage of gross advances, shot up to 23.60 per cent as on June 30, 2017 as against 20.48 per cent as on end-June last year.

"Accretion to gross NPA is contained to Rs 355 crore in the June quarter. One of the main reasons for higher gross NPA ratio is the contraction of credit by 9.26 per cent year-on- year," the bank said.

Net NPAs or bad loans also rose to 14.97 per cent of net advances by June 30, 2017 from 13.97 per cent by the end of June 2016.

Net NPA has reduced in quantum and the higher net NPA is due to contraction of credit by 9.26 per cent year on year, it said.

In value-terms, gross NPAs spiked to Rs 35,453.12 crore from Rs 33,913.15 crore for the comparable periods.

However, size of net NPAs was down at Rs 20,165.61 crore by end of June 2017 from Rs 21,321.24 crore a year earlier.

Among other key verticals, the net interest margin (NII) -- a key factor to measure profitability -- stood at 1.65 per cent for the quarter ended June 2017 as against 1.87 per cent end-June 2016. On the good side, bank cost to ratio fell to 61.40 per cent for the quarter from 63.62 per cent same period year ago.

On NPA management, IOB said the recovery during the June quarter is significantly higher at Rs 2,784 crore as against Rs 1,465 crore in the year ago corresponding period.

IOB stock closed 3.35 per cent lower at Rs 23.10 a unit on the BSE.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, August 10 2017. 18:42 IST