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Two public sector lenders, Bank of Baroda (BoB) and Bank of India (BoI), posted a drop in net profit for the fourth quarter ended March, due to a rise in provisioning for stressed loans and depreciation in value of investments.
BoB posted net profit of Rs 1,029 crore for Q4, from Rs 1,518 crore in January-March 2012. Its stock closed lower by 1.8 per cent on Monday, at Rs 691.85 on the BSE. Its provisioning for bad loans rose to Rs 1,097 crore from Rs 926 crore. The provision for depreciation on investment was Rs 211 crore against a write-back of Rs 271 crore in Q4 of FY12.
Chairman and Managing Director S S Mundra said it had made accelerated provision for slippages. Gross NPAs (non-performing assets) moved up to 2.4 per, cent from 1.53 per cent a year before. Total income rose to Rs 10,262 crore from Rs 9,016 crore in fourth quarter of 2011-12.
For the year ended FY13, net profits were down 10.5 per cent to Rs 4,481 crore from Rs 5,007 crore in 2011-12. The total income rose to Rs 38,827 crore from Rs 33,096 crore.
The restructured loan book was Rs 21,691 crore, including NPAs of Rs 2,611 crore at the end of March. Mundra said the pipeline for restructuring was Rs 2,500 crore in this quarter.
“The bank will have to live with the restructuring in the current environment. It is going to be more of a technical nature (due to delay in commencement of operations of units) than the financial one.” The capital adequacy ratio was 13.3 per cent, with Tier-I at 10.13 per cent at the end of March.
BoI’s net profit dipped 20.6 per cent to Rs 757 crore for Q4, from Rs 953 crore in the January-March quarter of 2012. The total income increased to Rs 9,266 crore from Rs 8,778 crore. The scrip closed lower by 4.35 per cent to Rs 324.25 on the BSE.
Chairperson and Managing Director Vijayalakshmi R Iyer said the provisions for bad loans rose to Rs 1,089 crore in Q4 from Rs 480 crore a year ago.
The bank also set aside Rs 258 crore for depreciation on investment, from Rs 76 crore a year ago. Gross NPAs were 2.99 per cent at end-March, up from 2.34 per cent a year ago. Restructured loan dues were Rs 16,353 crore. It expects to recast Rs 515 crore in the current quarter.
