Private sector South Indian Bank (SIB) on Thursday reported an 87.4 per cent year-on-year decline in net profit to Rs 10.31 crore for the June quarter as interest income fell while proportion of bad assets soared.
The bank had posted a net profit of Rs 81.65 crore in the same quarter of the previous fiscal year 2020-21. However, there was a rise sequentially as net profit during January-March 2021 stood at Rs 6.79 crore.Total income during Q1 FY22 came down to Rs 2,086.47 crore from Rs 2,171.86 crore in Q1 FY21, the bank said in a regulatory filing.
Interest income fell to Rs 1,633.39 crore from Rs 1,886.88 crore. Likewise, the income on investments and from other sources also dropped during the reported quarter.Its proportion of bad assets grew significantly, with the gross non-performing assets (NPAs) or bad loans jumping to 8.02 per cent of the gross advances as of June 30, 2021, as against 4.93 per cent in the year-ago period.
In value terms, the gross NPAs increased to Rs 4,677.12 crore from Rs 3,245.44 crore.Net NPAs also rose to 5.05 per cent (Rs 2,854.64 crore) from 3.09 per cent (Rs 1,992.86 crore).Provisions for bad loans and contingencies were raised to Rs 497.97 crore for the June quarter of FY22 as against 293.08 crore for the year-ago period.
Further, the lender said it has incorporated a wholly-owned non-financial subsidiary 'SIB Operations and Services Ltd' on May 28, 2021. It has not yet commenced business, it added.
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