IDBI Bank reports 53% drop in Q2 profit, clocks sharp rise in NPAs

NEW DELHI: IDBI Bank on Tuesday reported a 53.50 per cent year-on-year (YoY) plunge in profit at Rs 55.50 crore for the September quarter.

The lender had reported a net profit of Rs 119.50 crore for the corresponding quarter last year.

Interest earned for the quarter stood at Rs 6,992.80 crore compared with Rs 7,069.86 crore reported for the year-ago quarter. Net interest income for the quarter saw 0.4 per cent YoY degrowth at Rs 1,606 crore.

The bank reported a sharp surge in gross non-performing assets to 13.05 per cent in September quarter, compared with 11.92 per cent in June quarter and 6.92 per cent in the year-ago quarter.

On a net basis, NPAs stood at 8.32 per cent, which were higher than 7.47 per cent reported for Q1 of FY17 and 3.16 per cent in Q2 of FY16.

The IDBI Bank management said it would be able to maintain a net interest margin (MIN) close to 2 per cent. The lender said while recoveries have not been high, the company has been able to upgrade some assets.

IDBI Bank does not see significant improvement in upgrades during the rest of the financial year. Slippages stood at about Rs 5,000 crore, mainly from metals and textiles sectors.