Syndicate Bank reports Q4 loss of Rs 2,158 crore

This is because of a write-off of Rs 883 crore for a major fraud at three of its branches

Syndicate Bank on Tuesday reported fourth quarter losses of Rs 2,158.17 crore after it wrote off Rs 882.64 crore because of a major fraud at three of its branches in Jaipur in the past four years.

State-owned lender Syndicate Bank on Tuesday reported fourth quarter losses of Rs 2,158.17 crore after it wrote off Rs 882.64 crore because of a major fraud at three of its branches in Jaipur in the past four years.

The Manipal-based bank had found that the fraud was committed using fake documents, non-existent cheques, letters of credit and insurance policies. The Rs 882.64-crore write off is net of interest reversal of Rs 72.2 crore and available cash deposits of Rs 45.78 crore, the bank said in its regulatory filing. The bank had raised provisioning towards bad loans and contingencies to Rs 2,411.83, nearly thrice the Rs 715 crore made in the corresponding period last year.
 

The bank registered a marginal decline in total income to Rs 6524.6 crore for the quarter.

Syndicate Bank had reported profits of Rs 417 crore on total income of Rs 6,599 crore in the corresponding period last year.

Asset quality deteriorated further as gross non-performing assets (NPAs) rose to 6.7 per cent of gross advances during the quarter, from 3.13 per cent in the year-ago period.

In absolute terms, gross NPAs were Rs 13,832.16 crore in the quarter against Rs 6,442.38 crore last year.

Likewise, net NPAs or bad loans as a percentage of net advances stood at 4.48 per cent (Rs 9,014.87 crore) during the last quarter of 2015-16, from 1.9 per cent (Rs 3,843.65 crore) in the year-ago period.

The bank reported a net loss of Rs 1,643.49 crore for the full financial year 2015-16. It had earned a net profit of Rs 1,522.93 crore in 2014-15.

However, total income of the bank increased to Rs 25,706.51 crore in 2015-16, from Rs 23,724.75 crore in 2014-15.

In a separate filing, Syndicate Bank said the board of directors at its meeting held on Tuesday has not recommended payment of dividend for 2015-16.

Several public sector banks, including Bank of Baroda, UCO Bank, Central Bank of India, Allahabad Bank and Dena Bank, have reported losses due to bad loans.

The results and the cleaning up of the balance sheet was taken as a positive sign by investors. The bank's stock rose 4.72 per cent or Rs 3 to close at Rs 66.50 on the BSE.