United Bank of India reports fifth quarterly loss, restricts NPA

State-run lender United Bank of India has reported net loss for the fifth consecutive quarter even as it managed to restrict fresh generation of sticky loans by two-third.

The bank said its loss for the quarter to June was Rs 389 crore compared with Rs 212 crore loss in the year ago period, on account of high sticky loans and spike in mark-to-market treasury losses.

The ratio of gross non-performing assets slipped to 22.73% from 17.17% a year back, raising the provisioning requirement 13% to Rs 856 crore.

It has also provided Rs 252 crore towards mark-to-market treasury losses in the June quarter. Its operating profit fell 33% at Rs 282 crore over Rs 243 crore in the year ago quarter due to fall in treasury income which offset the doubling of net interest income.

Nonetheless, UBI has shown improvement in asset quality sequentially. Gross NPA ratio improved 137 bps from 24.1% at the end of March. This helped the lender, which has been under Reserve Bank of India’s prompt corrective action mechanism, cut losses in the June quarter compared to March quarter’s loss of Rs 413 crore.

The bank said it will continue its thrust on containing of fresh slippages and NPA reduction through resolution of large NPA accounts. It managed to restrict fresh slippage to Rs 547 crore in June quarter against Rs 1669 crore generation in the year ago period.

It has created a stressed asset management vertical under the finance ministry’s direction

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Punjab & Sind Bank reports net loss in Q1

State-owned Punjab & Sind Bank on Wednesday reported a net loss of Rs 398 crore in first quarter ended June as provisioning for bad loans increased significantly.It had reported a net profit of Rs 25.37 crore in the same period a year ago. In the preceding quarter ended March 2018, it had a net loss of Rs 524.62 crore, a dip in losses when compared sequentially.

For the entire 2017-18, the bank had posted a net loss of Rs 743.80 crore due to high proportion of bad loans.The bank in a regulatory filing said that the total income in April-June period of 2018-19 stood at Rs 2,336 crore, higher than Rs 2,062.57 crore in the same period of 2017-18.

For the June quarter, bank's provisioning for bad loans (or non-performing assets) shot up to Rs 795.38 crore as against Rs 259.20 crore set aside for the same period of the fiscal ended March 2018.

However, the bank brought down the proportion of soar assets with the gross NPAs falling to 10.55 percent of gross advances as on June 30, 2018 from 11.33 percent in year ago corresponding quarter.In value terms, gross NPAs stood at Rs 7,363.41 crore by end June this year as against Rs 6,693.36 crore. Net NPAs were 5.92 per cent (Rs 3,928.81 crore) as against 7.94 per cent (Rs 4,511.40 crore).

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Indian Bank Q1 profit down 44%

Chennai based Indian Bank reported a net profit of Rs 209.31 crore for the quarter ended June 30. This was a fall of almost 44% over the corresponding quarter last year. 

The bank is among the better performing PSU banks in the current scenario when most of them are grappling with high NPAs. It was one of the only two out of 21 PSU banks to book a profit in the preceding quarter. 

The net interest income, which is the total interest earned less interest expended on deposits, saw a rise of almost 24% to Rs 1807 crore. 

The gross non-performing assets, or total bad loans on the bank’s books, stood at Rs 11,827 crore, up from Rs 9653 crore at the end of the same quarter last year. However, the share of gross NPA to total lending remained stable at 7.2% due to a more than 20% increase in total lending. This is the second lowest gross NPA share amongst PSU banks after Vijaya Bank. 

Total deposits grew by 9.77%. up from Rs 1.9 lakh crore to Rs 2.1 lakh crore. 

The bank set aside Rs 1029.6 crore as provisions of which Rs 456.6 crore were for NPAs. Another Rs 362.75 crore were provided for mark to market (MTM) losses, leaving MTM losses to the tune of Rs 636.1 crore to be provided for in the subsequent two quarters. This is in accordance with RBI’s special dispensation to allow banks to spread provisions for MTM losses over four quarters starting the quarter ended 31 March.

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City Union Bank Q1 profit rises 15% on lower provisions

Private sector lender City Union Bank has reported a 15.2 percent year-on-year in net profit to Rs 161.6 crore, driven by lower provisions and stable asset quality.

Profit in the year-ago period was Rs 140.3 crore.

Net interest income, the difference between interest earned and interest expended, grew by 9.5 percent to Rs 374.8 crore compared to Rs 342.4 crore in same quarter last fiscal.

Asset quality was stable for the quarter ended June 2018. Gross non-performing assets as a percentage of gross advances were lower at 3.02 percent for the quarter against 3.03 percent in previous quarter while net NPA was unchanged at 1.70 percent sequentially.

Provisions for bad loans dropped 33.4 percent year-on-year to Rs 77.7 crore in Q1FY19 and also declined 9.85 percent on sequential basis.

Other income or non-interest income during the quarter fell 4.6 percent to Rs 129.11 crore but operating profit increased 0.8 percent to Rs 299.4 crore compared to year-ago.

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Punjab National Bank(PNB) posts smaller-than-expected net loss for Q1; asset quality improves QoQ

Fraud-hit Punjab National Bank (PNB) reported a loss of ₹ 940 crore in the June quarter of 2018-19 (Q1 FY19) against a profit of ₹ 343 crore in the year-ago period. The bank managed to improve on its performance compared to the immediate preceding quarter as it recovered a substantial portion of its non-performing assets (NPAs).

PNB’s gross NPAs were at 18.26% in Q1 as against 13.66% in the year-ago period and 18.38% in the preceding quarter. Net NPAs were at 10.58% in the June quarter as against 8.67% in the year-ago period and 11.24% in the preceding quarter. Provisioning for NPAs was at ₹ 4,981 crore as against ₹ 2,559 crore in the year-ago period and ₹ 16,202 crore in the last quarter.

The bank had reported a record loss of ₹ 13,417 crore in the fourth quarter of 2017-18 on account of provisioning for NPAs due to tighter loan classification norms by the Reserve Bank of India, PNB fraud-related payouts to other banks as well as losses in the bond portfolio.

PNB, the fourth-biggest bank by assets among all of India’s lenders, in February said it had been defrauded by jewellers Nirav Modi and Mehul Choksi, who raised more than $2 billion credit overseas using fake letters of undertaking (LoUs) provided by the bank’s staff at its Brady House branch in Mumbai.

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Dhanlaxmi Bank reports net loss in Q1 as bad loans rise

Private sector Dhanlaxmi Bank today reported a net loss of Rs 45 crore in the first quarter ended June 2018. The bank had registered a net profit of Rs 7.97 crore in the corresponding April-June quarter a year ago. The losses widened against preceding March quarter's Rs 17.16 crore.

Total income during the said quarter was down at Rs 256.36 crore from Rs 287.25 crore a year ago, the bank said in a regulatory filing. The core income from interest was also down at Rs 239.92 crore in three months to June from Rs 259.30 crore year in April-June of 2017-18.

Bank's gross bad loans as a proportion of gross loans by end-June 2018 spiked to 8.94 percent (Rs 531.05 crore), compared to 5.62 percent (Rs 354.13 crore) as on June 30, 2017.

Net NPAs were at 3.79 percent (Rs 212.84 crore), up from 3.15 percent (Rs 193.12 crore). Provisions an contingencies increased to Rs 65.01 crore in the quarter, as against Rs 18.66 crore in same period year earlier. Provision coverage ratio was at 79.45 percent as on June 30, 2018.

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Syndicate Bank Q1 net loss widens nearly 5 times, NPAs soar

State-owned Syndicate Bank today said its net losses have widened to Rs 1,281.77 crore during first quarter ended June of the current fiscal as bad loans rose. 

Its loss in the corresponding April-June period of 2017-18 was at Rs 263.19 crore. Its income also fell to Rs 5,637.51 crore during the June quarter of 2018-19, as against Rs 6,171.49 crore a year ago. 

The bank said in a regulatory filing that its interest income fell to Rs 5,257.19 crore, from Rs 5,484.13 crore. Besides, there was significant fall in interest earned on balances with RBI and other inter bank funds. 

The asset quality was dented further to 12.59 per cent of the gross non-performing assets (NPAs) or bad loans as on June 30, 2018 from 9.96 per cent a year ago. 

It was 11.53 per cent in the preceding quarter ended March. Net NPAs too worsened to 6.64 per cent, from 6.27 per cent as on June 30, 2017 and 6.28 per cent by end March this year. In value terms, the gross NPAs stood at Rs 26,361.52 crore at June 30 this year, as against Rs 20,183.85 crore a year ago. 

Net NPAs were at Rs 13,010.80 crore vis-a-vis Rs 12,188.30 crore."Based on legal opinion given by an independent expert, pending issuance of final NCLAT order, an amount of Rs 100.86 crore recovered in an NPA account is considered as eligible credit for the calculation of NPA provision," Syndicate Bank said in the filing. 

Due to rise in portion of bad loans, the bank parked aside a higher provisioning amount for NPAs at Rs 1,774.11 crore in June quarter, as against Rs 1,385.66 crore a year ago. Overall provisioning and contingencies were at Rs 2,326.82 crore, up from Rs 1,333.88 crore. 

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Dena Bank Q1 loss widens as provisions double

Despite lower bad loans,  government-owned Dena Bank's first quarter FY19 net loss widened five-fold year-on-year (YoY) to Rs 721.71 crore from  Rs 132.65 crore.

The loss grew on the back of higher provisions towards bad loans. The bank had a massive net loss of Rs 1,225.42 crore in the January to March quarter of FY18.

Provisions and contingencies more than doubled to Rs 1,118.75 crore in Q1 this year from Rs 522.48 crore in June quarter last year. Provisions towards non-performing assets (NPAs) rose to Rs 1,244 crore YoY from Rs 435 crore. Sequentially, provisions reduced from Rs 1,991 crore in the March quarter.

NPAs

During the quarter, gross NPAs reduced in absolute terms but deteriorated as a percentage of total loans due to a limited expansion in credit growth.

Gross NPA ratio as a percentage of total loans worsened to 22.69 percent from 22.04 percent in March end 2018 and 17.37 percent in June quarter last year.

However, in absolute terms, gross NPAs declined to Rs 15,866 crore from Rs 16361 crore in the March quarter and increased from Rs 12,994 crore as on June quarter last year.

Net NPA ratio improved to 11.04 percent from 11.95 percent as on March end and 11.22 percent as on June end 2017.

NII and Other income

NII or net interest income (the difference between interest earned and expended) grew to Rs 742.74 crore, up 10 percent from Rs 675.05 crore a year ago.

Non-interest income or other income dropped 32 percent to Rs 161.39 crore in June end 2018 from Rs 237.29 crore in June end 2017.

Capital

Signalling weakness in financial strength, the state-owned bank's capital adequacy ratio (CAR) declined to 10.60 percent as on June end 2018 from 11.09 percent as on March 2018 and 11.65 percent as on June end 2017.

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