Bank of Maharashtra Q3 net loss widens three-fold to Rs 5.96 billion

State-owned Bank of Maharashtra on Tuesday reported over three-fold jump in net loss to Rs 5.96 billion during the quarter ended December 2017 on spike in provisions due to higher NPA ratio.

The bank had posted a net loss of Rs 1.82 billion in the corresponding quarter of the previous fiscal. The bank had incurred a net loss of Rs 232.4 million in the second quarter ended September 2017.

The bank's asset quality weakened, both annually and sequentially, with gross non-performing assets (NPAs) rising to 19.05 per cent of the gross advances as on December 2017 against 15.08 per cent by end of December 2016 and 18.54 per cent by September 2017.
 

Net NPAs too rose to 12.17 per cent of the net advances by end of the third quarter from 10.67 per cent in same period a year ago.

Thus, the provisioning for bad loans or NPAs was raised substantially to Rs 13.43 billion during the third quarter of 2017-18, against Rs 5.32 billion provision in the same quarter of 2016-17, the company said in a regulatory filing.

"As per RBI directions for initiating insolvency process provisioning norms in respect of 10 accounts (June 2017) and in respect of 10 other accounts (August 2017) covered under provisions of the Insolvency and Bankruptcy Code 2016, the bank is required to make additional provision of Rs 10.77 billion for NPAs and Rs 98.9 million for standard advances by March 2018," it said in the filing.

Of this, the bank has already made total provision of Rs 6.51 billion for non-performing advances and Rs 49.5 million for standard advances till December 2017, it said.

The total income of the bank too witnessed a beating with earnings falling to Rs 29.94 billion in October-December period of this fiscal against Rs 34.73 billion in the same quarter of 2016-17.

Bank of Maharashtra said it sold advances amounting to Rs 610.8 million (Rs 102.2 million during the quarter) to an asset reconstruction company at a loss of Rs 55.3 million on such sale during the nine months ended December, 2017.

Loans and advances of Rs 1.94 billion were classified as fraud during the nine months from April to December and the entire amount is provided for, the bank said.

Stock of Bank of Maharashtra traded 1.55 per cent lower at Rs 19.05 on BSE.