YES Bank slips into loss on big IL&FS hit: Key Q4 takeaways

A manifold rise in provisions forced private sector lender YES Bank to report a surprise loss of Rs 1,506.60 crore for the quarter ended March 31 against a profit of Rs 1,179.40 crore in the corresponding quarter last year.

Provisions spiked 816.20 per cent to Rs 3,661.70 crore over Rs 399.60 crore in the year-ago period. YES Bank announced its results post market hours. Earlier in the day, the stock of the lender settled 0.13 per cent down at Rs 237.40.

Net interest income (NII) increased 16.30 per cent YoY to Rs 2,505.90 crore, while non-interest income dipped 62.60 per cent to Rs 537.70 crore. Operating profit also declined 38 per cent to Rs 1,323.40 crore.


“Lower NII or NIM was on account of higher NPA recognition in Q4,” YES Bank said in a filing.

The board of the lender proposed a dividend of Rs 2 per equity share.

Here are the top takeaways from YES Bank's fourth quarter earnings:

Fundraising: The board has approved raising of up to Rs 20,000 crore via debt and $1 billion -- in one or more tranches -- by way of equity shares.

NPA: Asset quality of the lender deteriorated with the percentage of gross non-performing assets (GNPA) jumping to 3.22 per cent over 2.10 per cent in December quarter. The GNPA was 1.28 per cent in the corresponding quarter last year.

Net NPA also spiked to 1.86 per cent over 1.18 per cent on a sequential basis. It was 0.64 per cent in the year-ago period.

Gross slippages: YES Bank saw gross slippages of Rs 3,481 crore, of which Rs 552 crore was on account of an airline company (Jet Airways) and Rs 529 crore on account of stressed infrastructure conglomerate.

Exposure to IL&FS group: The bank has classified Rs 2,442 crore loan to IL&FS group as non-performing asset (NPA). It also provided Rs 12.89 crore for standard accounts of IL&FS group.

Proactive build-up in contingent provision: The bank has created contingency provision of Rs 2,100 crore pursuant to a review of the credit portfolio. Post contingency provision, the bank expects FY20 credit costs of up to 125 basis points with expected further normalisation in FY21.

Advances and deposits: Advances grew 18.70 per cent year-on-year to Rs 2,41,499.60 crore as of March 31, while deposits jumped 13.40 per cent to Rs 2,27,610.20 crore.

Retail composition of total advances improved to 16.70 per cent in March from 12.2 per cent last year. CASA ratio declined to 33.10 per cent from 36.50 per cent for the same period.

Provision coverage ratio: The figure stood at 43.10 as of March 31 against 50 per cent in the same period last year.