However sequentially, the loss narrowed by 20.56 per cent from Rs 12.22 billion.
R Subramaniakumar, Managing Director & CEO, Indian Overseas Bank attributed the loss mainly due to high provisions for non-performing assets (NPAs).
On a sequential basis, however, the provisions stand reduced by 26.76 per cent and are down by about Rs 6.05 billion quarter on quarter.
As at December 2017, Bank's gross NPA stood at Rs 332.67 billion crore with a ratio of 21.95 per cent as against Rs 345.02 billion, a year ago (22.42 per cent).Gross NPA were down by Rs 14.41 billion during the third quarter, from Rs 347.08 billion in the second quarter.
IOB was able to make recoveries to the extent of Rs 30.20 billion for the quarter ended December 2017. Total slippage for the third quarter was Rs 14.31 billion, said Subramaniakumar. He added, in the last three quarters the recovery was over Rs 90 billion.
Total provision coverage ratio (PCR) improved to 57.83 per cent as on December 31, 2017 from 55.88 per cent as on September 2017. Following RBI's June 2017 directive on accounts covered under the Insolvency and Bankruptcy Code (IBC) for outstandings as on December 31, 2017, the Bank is required to make additional provision of Rs 7.18 billion by March 31, 2018. Of this, IOB has already provided Rs 5.24 billion up to December 31, 2017 and the rest will be provided before March 31.
Similarily the Bank is required to make additional provision of Rs 6.53 billion by March 31, 2018 of which it has provided Rs 3.56 billion. The balance, IOB says will be provided by March 2018.
Commenting on the turnaround, Subramaniakumar said the bank is expected to turn around by the third quarter of 2018-19 and make its first quarterly profit.
This will be achieved through various measures, including sorting out accounts referrred to NCLT. According to Subramaniakumar, accounts worth about Rs 100 billion have been blocked due to NCLT cases. However, 50 per cent of these are expected to be unlocked by the first quarter which will bring down the NPA level by nearly Rs 50 billion.
Folloiwng this, Subramaniakumar expects the bank's net NPA to shrink to around 8-9 per cent from the current 13.08 per cent, while gross NPA is likely to come down to 16 per cent from 21.95 per cent.
Going forward, Subramaniakumar said the emphasis will be retail, agriculture and MSME (RAM). He said the corporate book had shrunk to 42 per cent from 58 per cent, as the bank decided to stay away from the sector, where the risks are high.
Subramaniakumar said the Central Government has infused Rs 1.73 billion in January 2018, and had also announced capital infusion of Rs 46.94 billion for 2017-18 as part of the recapitalisation plan.
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