United Bank of India loss widens in Q3FY19 due to NPA rise

State-owned United Bank of India on Tuesday reported widening of loss to Rs 1,139.25 crore for the December 2018 quarter, owing to rising bad loans.

The Kolkata-based lender had posted a loss of Rs 637.53 crore in the corresponding quarter a year ago.

However, the total income of the bank rose to Rs 2,846.23 crore during the quarter, compared with Rs 2,483.01 crore in the year-ago quarter.


Also read- Q3FY19 Results of all Public & Private Sector banks in India 

Its asset quality worsened with gross non-performing assets (NPAs) rising to 21.27 per cent (Rs 14,737.61 crore) of the gross advances as on December 2018, compared with 20.10 per cent (Rs 13,720.69 crore).

Net NPAs or bad loans also increased to 12.08 per cent (Rs 7,489.89 crore) from 11.96 per cent (Rs 7,365.14 crore).

As a result, provision other than tax and contingencies nearly doubled to Rs 1,967.20 crore, compared with Rs 1,074.35 crore in the same period a year ago.

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IDFC First Bank posts big loss in Q3FY19

Private sector lender IDFC First Bank Tuesday reported a net loss of Rs 1,538 crore during the December 2018 quarter, due to one-time exceptional charge to its profit and loss account (P&L) for amalgamating Capital First with itself. 

The bank had registered a net profit of Rs 146.11 crore in the corresponding quarter of previous fiscal. 

Sequentially, there was a net loss of Rs 369.69 crore in the second quarter ended September of the current fiscal. 

Total income of IDFC First Bank, previously IDFC Bank, rose to Rs 3,968.40 crore in December quarter of 2018-19, compared with Rs 2,514.51 crore in the corresponding period of 2017-18, it said in a regulatory filing.

Also read- Q3FY19 Results of all Public & Private Sector banks in India 

Under Section 15 of the Banking Regulation Act 1949, banks are restricted from declaring dividend in the event a bank carries intangible assets such as goodwill on its balance sheet, IDFC First Bank said. 

"Therefore, as a prudent measure, intangible assets acquired or arising on amalgamation have been fully amortised through profit and loss account in the quarter and nine months ended December 31, 2018. 

"This accelerated amortisation charge to profit and loss account for the quarter and nine months ended December 31, 2018 of Rs 2,599.35 crore is exceptional in nature and resulted in loss for the quarter ended December 31, 2018," the bank said. 

On the asset front, there was a reduction in bad assets with gross non-performing assets (NPAs) coming down to 1.97 per cent of the gross advances as at the end of December 2018, from 5.62 per cent as against a year ago. In value terms, gross NPAs were Rs 1,670.85 crore, down from Rs 2,776.67 crore. 

Net NPAs were 0.95 per cent (Rs 796.02 crore), against 2.52 per cent (Rs 1,206.28 crore). 

The bank said merger of Capital First and its wholly owned subsidiaries, Capital First Home Finance and Capital First Securities, with IDFC Bank has been approved by the Reserve Bank of India, the Competition Commission of India, the Securities and Exchange Board of India, stock exchanges, the respective shareholders and creditors of each entities. 

The name of IDFC Bank changed to IDFC First Bank with effect from January 12. 

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Lakshmi Vilas Bank(LVB) net loss widens in Q3FY19

Private sector lender Lakshmi Vilas Bank (LVB) on Monday reported widening of its net loss to Rs 373.49 crore for third quarter ended December 2018, as bad loans more than doubled year-on-year. It had posted a net loss of Rs 39.23 crore during the corresponding period of the previous fiscal. Sequentially, there was a net loss of Rs 132.31 crore in the second quarter ended September 2018.

Total income also fell to Rs 762.48 crore in October-December 2018 as compared with Rs 817.51 crore, the bank said in a regulatory filing.

The bank's gross bad loans more than doubled to 13.95 per cent of gross loans during the quarter, against 5.66 per cent by in the year-ago quarter.

In value terms, gross bad loans or non-performing assets (NPAs) ballooned to Rs 3,364.28 crore as against Rs 1,427 crore a year ago.

Net NPAs rose to 7.64 per cent (Rs 1,716.22 crore) from 4.27 per cent (Rs 1,060.46 crore).

Also read- Q3FY19 Results of all Public & Private Sector banks in India 

Thus, the provisioning for bad loans and contingencies were raised to Rs 431.39 crore for the quarter, against Rs 85.35 crore in the corresponding period of 2017-18.

Total business stood at Rs 54,910 crore as against Rs 55,851 crore a year ago.

The return on assets plunged to (-) 3.90 per cent in the December quarter, against (-) 0.42 per cent for the year-ago period.

"Over the quarter, the bank has reduced exposure to NBFCs, real estate and infrastructure sectors by Rs 800 crore. Exposure to the NBFC sector is today at Rs 2,136 crore, which is 8.16 per cent of the lending book. There is no NPA in this sector with us," it said in a release.

The bank's exposure to the real estate sector is Rs 3,742 crore, which is 14.3 per cent of the lending book of the bank.

"Out of this exposure, Rs 1,832 crore is to developers. Stress is of Rs 245 crore. The exposure to LAPs (loan against property) is Rs 959 crore. We have not noticed any particular stress in that book," the bank said.

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Punjab National Bank(PNB) Q3 profit rises 7%; asset quality improves

Punjab National Bank(PNB) reported a surprise net profit of Rs 246.5 crore for the December quarter. This implies a jump of 7 percent from Rs 230 crore that the bank posted during the same quarter of last year.

The net interest income (NII) rose around 8 percent at Rs 4,290 crore against Rs 3,989 crore that the lender reported last year.

On the asset quality front, gross non-performing assets (NPAs) stood at Rs 77,733 crore against Rs 81,251 crore that was reported during the previous quarter. Net NPAs have fallen to Rs 35,675 crore from Rs 38,279 crore last year.

Also read- Q3FY19 Results of all Public & Private Sector banks in India 

Gross NPA ratio fell to 16.33 percent for the quarter under review against 17.16 percent last quarter. The net NPA ratio fell to 8.22 percent from 8.9 percent in the previous quarter.

Provisions stood at Rs 2,754 crore against Rs 9,758 crore in the last quarter. Last year, it had reported provisions of Rs 4,467 crore.

The bank further informed that it has written back a provision of Rs 163 crore for its IBC accounts. It has made a provision of Rs 2,014 crore in relation to a fraud.

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AIBEA circular on UFBU Bipartite Settlement talks with IBA on 2nd Feb

 

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IDBI Bank reports threefold increase of loss in Q3

IDBI Bank Monday posted widening of loss by nearly threefold to Rs 4,185.48 crore for the third quarter ended December 2018 as bad loans surged.

The bank had reported a net loss of Rs 1,524.31 crore in the corresponding quarter of the previous fiscal.

Total income decreased to Rs 6,190.94 crore for the quarter, compared with Rs 7,125.20 crore in the corresponding quarter a year ago, IDBI Bank said in a statement.

The bank's gross non-performing assets (NPAs) shot up to 29.67 per cent of gross advances during the quarter, against 24.72 per cent in the year-ago period.

However, net NPAs declined to 14.01 per cent of the total advances, from 16.02 per cent in the December 2017 quarter.

Also read- Q3FY19 Results of all Public & Private Sector banks in India 

As a Result,result, the bank's provision for bad loan increased to Rs 5,074.80 crore, compared with Rs 3,649.82 crore a year ago.

However, slippages were Rs 2,211 crore which were lowest in the past seven quarters, Recovery from NPAs improved to Rs 3,440 crore during the quarter, compared with Rs 537 crore in the same period a year ago.

The ownership of the bank has changed from the Government of India to LIC.

The statement further said Life Insurance Corporation of India (LIC) completed acquisition of 51 per cent controlling stake in IDBI Bank on January 21 and the bank received total capital of Rs 21,624 crore from the insurer.

On the backdrop of capital infusion from LIC, it said that the bank has achieved regulatory capital requirement as on December 31, 2018, and its common equity tier-1 (CET-1) capital improved to 9.32 per cent as on December 31, 2018, against 6.62 per cent a year ago.

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IBA & Bank union meeting for 11th Bipartite Settlement on 02nd Feb- updates

Another round of Bipartite Talks was held today in Mumbai between IBA and our 5 Workman Unions.

Also Read - Charter of Demands for 11th Bipartite Wage Revision

Also Read - 11th BPS Wage Settlement : Expected New Basic Pay for bankers

Issues which were discussed in the meeting 
 • Transportation of personal effects by train or road while on transfer from one station to another: Some improvements would be considered looking to entitlement of officers. 

• Increase in Breakage Allowance while on transportation of personal effects: agreed to increase the existing entitlement by 10% for both With Receipt Basis and Declaration Basis. 

• Festival Advance to employees – increase in quantum: Agreed to finalise it by discussion in the main negotiating committee and recommend to the Government. 


• Problems of Ex-servicemen employees in fitment, etc: Government guidelines from the Finance Ministry are being implemented. Circular with FAQ will be prepared and sent to all Banks for proper implementation of the Government guidelines. 

• Definition of family for coverage under Group Medical Insurance Policy – Any two of parents or parents-in-law to be covered: Matter will be taken up with United India Insurance Company. 

• Privilege Leave taken on sick grounds where sick leave is exhausted should not be counted as an occasion in the entitlement of 4 occasions in an year: Agreed. 

• Maternity Leave can be availed in combination and continuation of other kinds of leave: Agreed.

Follow up action in issues covered by Record Note on retirees issues dated 25-5-2015: 

• LFC for retired employees – IBA is not in favour. • Fixing the premium on medical insurance scheme for retirees – Separate discussions will be held with UFBU.

• Increase in Ex-Gratia Pension to pre-1986 retirees/spouses – will be recommended to Government. • Revision of Family Pension – will be discussed further in the full negotiating committee. 

• Updation of pension and periodical revision in pension along with wage revision for in-service employees - will be discussed further in the full negotiating committee. 

• Revision in DA on pension on quarterly basis like serving employees - will be discussed further in the full negotiating committee. 

• Allocation of fund for Staff Welfare Schemes based on Operating Profits instead of Net Profit – matter has been recommended to Government and their decision is awaited.


Issues relating to Disciplinary Action and Procedure:

• These issues were discussed in a Small Committee of IBA and Workman Unions. The gist of the discussions, the issues raised by us and their response are given below: 

• Eligibility for claiming TA/DA by the Defence Representatives for attending departmental enquiries held outside the State. ➢ Such claims will be sanctioned by Banks looking to the merits of the claims. 

• Improvement and enhancement in rates of Subsistence Allowance payable to employees on suspension. 
➢ Matter will be discussed further in the Full Negotiating Committee 

• Indiscriminate use of Clause 5(j) relating to acts alleged as prejudicial to the interest of the Bank
➢ “Doing any act prejudicial to the interest of the Bank” will be included under Minor Misconduct as a new Clause 7(q).

• Clarification with regard to provision of Clause 6(e) of Settlement dt 10-4-2002 i.e. bringing down by two stages in the scale of pay 

➢ The specific period of rigour shall be mentioned in the punishment order. It can be for a maximum of 2 years without cumulative effect and annual increment/stagnation increment falling due during the rigour period will be released on respective due dates. 

Clarification to be given that acts of minor misconducts clearly enumerated under Clause 7 of Settlement dated 10.4.2002 should not be brought as major misconduct under Clause 5. ➢ Unions’ contention is agreed upon. 

• Multiple charges for one incident should not be made out. 

➢ Multiple charges, as per the procedural lapses, can be made for one incident. However, punishment given shall be only one.

• Punishment order by the Disciplinary Authority not to be implemented till the final disposal of Appeal by the Appellate Authority. 

➢ This proposal was not agreed to.

• Disciplinary action should not be taken after retirement quoting Pension Regulation as the same is not provided in Bipartite Settlement. 

➢ Issue needs to be discussed at Full Negotiating Committee 

• Awarding the punishment of stoppage of increments should be without affecting superannuation benefits, as in the case of Officers. 

➢ Disciplinary Authority may be given the discretion to decide whether the punishment will affect superannuation benefit or not. 

• Provision to be added for making an Appeal against suspension of employees 

➢ Suspension is not a punishment and hence this proposal cannot be accepted. 

• In cased of dismissal as punishment, there should be a Review Authority after Appellate Authority. ➢ Not acceptable.

• Imposing ‘Fine’ as punishment should be deleted from the list of punishments. 

➢ Agreed to recommend deletion to the Full Negotiating Committee

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Central Bank of India narrows loss in Q3FY19

Central Bank of India on Friday reported a loss of Rs.718.23 crore for the third quarter ended December 2018 against that of Rs.1,664.22 crore in the October-December quarter of previous fiscal.

Its total income decreased to Rs.6,329.17 crore during the quarter under review, as against Rs.6,589.32 crore in the year-ago period, the bank said in a regulatory filing.
Also read- Q3FY19 Results of all Public & Private Sector banks in India 

Asset quality of the bank further deteriorated as gross non-performing assets (NPAs) grew to 20.64 per cent of gross advances during the December quarter, as against 18.08 per cent in the year-ago period. Net NPAs also increased at 10.32 of advances from 9.45 per cent a year ago.

However, the provisioning for bad loans and contingencies on net basis was at Rs.1,818.85 crore during the quarter, down from Rs.3,427.03 crore a year ago.

The provision for bad loans also declined to Rs.2,039.19 crore against Rs.3,081.56 crore in the same period a year ago.

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