Bank of India Q4 loss triples to Rs 40 billion on bad debt provisioning

Bank of India’s net loss for the quarter ended March tripled over that of the previous year, due to bad debt provisioning and treasury losses.

The government-owned entity’s net loss was Rs 39.7 billion; it was nearly Rs 10.5 billion in January-March 2017.

Gross non-performing assets as a percentage of total advances were 16.58 per cent (at Rs 623 billion), against 16.93 per cent (Rs 642 billion) in the December quarter. In the year-ago quarter, it was 13.22 per cent.     

Net interest income fell 26 per cent from a year before to Rs 25.6 billion, from Rs 34.7 billion. Net interest margin, the difference between the yield on advances and cost of funds, was 1.65 per cent against the year-ago quarter’s 2.39 per cent.

Other income, comprising fees and other non-interest income, was nearly Rs 13.8 billion. 

The bank is focusing more on loans to individuals, which rose 10 per cent to Rs 1.37 trillion; those to companies fell 4 per cent to Rs 1.48 trillion. “We are going in the right direction. We have seen domestic growth and are reducing our international business. We have reduced our corporate (loan) book from 52 to 48 per cent,” said Managing Director Dinabandhu Mohapatra. The bank wants the retail loan book to go up to 60 per cent of the total, from the current 52 per cent. 

The capital adequacy ratio at end of March was 12.94 per cent, against 12.14 per cent at the end of March 2017. The share price closed on Monday at Rs 107.85 on the BSE, up   4.7 per cent from the previous day’s close. The results came after market hours.

NII: Net interest income; NPA: Non-performing asset; Source: Results filing; Compiled by BS Research Bureau