Dena Bank Tuesday said it expects to bring down gross non-performing assets (NPAs) to 15 per cent by March 2019, from existing 22-23 per cent, which will help it reduce losses.
Its managing director and chief executive officer Karnam Sekar told reporters here that the resolution of NPAs of several corporate customers are in advanced stages at the National Company Law Tribunal (NCLT), or towards asset restructuring and one-time settlement.
"We hope that we will settle most of the cases by March 2019. Huge accounts are in advanced stages of resolution. By March 2019, our gross NPAs, which is currently between 22 per cent and 23 per cent, will surely come down. Practically, it will come down to 15 per cent (from Rs 16,000 crore to Rs 10,000 crore)," said Sekar, who joined the bank last month as its MD and CEO.
He said that the bank has not added any NPAs in the last two quarters, and in September quarter, it reduced slightly.
"We have been loss making in the last three years, and we need to come out of that. Huge NPAs are reasons for the loss. Fortunately, most corporate customer cases are either in the advanced stages in NCLT, ARC, or bilateral OTS," Sekar told media persons.
He also added that Dena Bank is working to improve its CASA (current accounts and savings accounts) ratio, which will positively affect its profitability.
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"We have 40-41 per cent CASA ratio. With more focus, we are trying to take it to at least 44-45 per cent. So, both NPA reduction and CASA improvement will improve the profitability of the bank," he said, while hoping to "turn the corner" by 2019-20.
Last month, the government had announced the merger of state-owned Bank of Baroda (BoB), Vijaya Bank and Dena Bank, to create the country's second largest lender, after the State Bank of India.
Sekar said Dena Bank is also working towards amalgamation with BoB and Vijaya Bank, for which a steering committee of the three entities is holding meetings every week.
"We have formed a steering committee which is meeting every week to decide on which areas to concentrate, which to harmonise, and timelines for various steps," he said.
Sekar further said that timelines for merger will be decided in the next two-three meetings.