Axis Bank Ltd, India's third biggest private-sector lender, on Tuesday reported a surprise ₹1,388 crore loss for the fourth quarter, as it set aside funds to cover potential loan losses due to the coronavirus-driven downturn.
The Mumbai-based Axis booked provisions of ₹7,730 crore for the quarter, or nearly three times higher than last year, including ₹3,000 crore towards COVID-19, the lender said in a regulatory filing.
Analysts had expected a profit of ₹1,556 crore for the three months to March 31, according to Refinitiv data, compared to a reported profit of ₹1,505 crore a year earlier.
However, gross bad loans as a percentage of total loans, a measure of asset quality, eased to 4.86% at March-end from 5% in the previous quarter.
It had reported a profit of ₹1,757 crore in the October to December quarter (Q3FY20).
The net interest income in Q4FY20 grew by 19 per cent year-on-year to ₹6,808 crore while operating profit was up by 17 per cent to ₹5,851 crore.
On the asset quality front, net NPAs declined to 1.56 per cent in the quarter ended March.
Provisions and contingencies during the quarter stood at ₹7,730 crore, increasing significantly from ₹2,711 crore year-on-year and ₹3,471 crore quarter-on-quarter.
For the entire year 2019-20, the net profit was ₹1,627 crore compared to ₹4,677 crore in the year ended March 2019. Adjusted for the one-offs, net profit for FY20 would have been ₹5,182 crore. up 11 per cent year-on-year, the lender said.
The net interest income in FY20 grew by 16 per cent year-on-year to ₹25,206 crore.
As on March 31, the bank's gross NPAs stood at ₹30,234 crore and net NPAs at ₹9,360 crore. The bank's provision coverage as a proportion of gross NPAs stood at 69 per cent.
Managing Director and CEO Amitabh Chaudhry said the COVID-19 crisis is a long drawn one and it will need courage, grit and a fighting spirit to combat it.
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