State-owned Central Bank of India’s net loss widened by 74% to Rs. 1,522.54 crore in the quarter ended June 30, 2018 due to a more than two-fold spike in provisions for bad loans.
The bank had registered a net loss of Rs. 576.76 crore in the April-June quarter of 2017-18, according to a regulatory filing by the bank. In preceding quarter ending March 2018, the bank had reported a net loss of Rs. 2,113.51 crore.
The bank’s income fell to Rs. 5,904.82 crore in the first quarter of 2018-19 from Rs. 6,870.78 crore in the same period of 2017-18 as core income dropped. The bank earned an interest income of Rs. 5,691.87 crore during the quarter through June, a fall of 8.4% from Rs. 6,210.91 crore in the year-ago quarter.
Gross non-performing assets (NPAs) jumped to 22.17% of gross advances by the end of June from 18.23% as on June 30, 2017. In value terms, gross NPAs or bad loans stood at Rs. 38,777.66 crore as against Rs. 31,398.47 crore.
Net NPAs, however, fell to 10.58% (Rs. 16,086.25 crore) by the end of June quarter, from 11.4% (Rs. 17,407.43 crore) year earlier same period. The provisioning for bad loans were raised by over two-times to Rs. 2,538.14 crore at June-end this year from Rs. 1,028.93 crore set aside for the same period of 2017-18.
Overall provisions and contingencies too increased to Rs. 2,768.22 crore against Rs. 1,269.02 crore. The return on assets further worsened at (-) 1.85% from (-)0.71% year ago. However, it improved from (-)2.75% in March quarter.
Central Bank of India said for the accounts covered under the provisions of Insolvency and Bankruptcy Code, it is holding an additional provision of ₹ 690.20 crore as on June 30, 2018, in respect of 21 borrower accounts.
“During the quarter, the bank has appropriated the amount recovered in accordance with the resolution plan approved vide order National Company Law Tribunal (NCLT). The Bank has appropriated an amount of Rs. 76.29 crore recovered in one of the cases, where appeal is pending before the National Company Law Appellate Tribunal (NCLAT),” it said. Provisioning coverage ratio stood at 66.42% as on June 30, 2018 against 54.48% year ago.
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