Canara Bank posts $723 million fourth-quarter loss as bad-loan provisions soar

BENGALURU/MUMBAI (Reuters) - Indian state-run Canara Bank Ltd reported a 48.60 billion-rupee ($722.57 million) fourth-quarter net loss after a surge in provisions for bad loans.

The loss for the three months to March 31 compared with a net profit of 2.14 billion rupees a year ago, the bank said in a statement.

Indian banks, already burdened by a near-record 9.5 trillion rupees of soured loans as of last year, are expected to report a further rise in bad loans in the March quarter after a central bank withdrew half a dozen loan-restructuring schemes and tightened some rules in February.

Canara Bank's gross non-performing loans as a percentage of total loans rose to 11.84 percent at end-March, compared with 10.38 percent in the preceding quarter and 9.63 percent a year ago.

 

Provisions for non-performing assets almost tripled from a year earlier to 87.63 billion rupees.

Dena Bank, a smaller state-run lender which also reported on Friday, saw its fourth-quarter net loss widening to 12.25 billion rupees and bad loans rising.

Union Bank of India, also state-run, reported on Thursday a 25.83 billion-rupee net loss for the fourth quarter.

Ahead of the results, Canara Bank shares closed 0.8 percent lower in a Mumbai market that rose 0.8 percent.

($1 = 67.2600 Indian rupees)

(Reporting by Vishal Sridhar, Devidutta Tripathy and Aby Jose Koilparambil; Editing by Subhranshu Sahu and Louise Heavens)