Bank of India Q4 loss at Rs 3970 cr on higher provisions

New Delhi, May 28: State-owned lender Bank of India Monday reported a net loss of Rs 3,969.27 crore for the March quarter, as asset quality worsened and provisions increased. The bank had posted a loss of Rs 1,045.52 crore in the same quarter last year.
Analysts polled by Reuters had estimated the bank’s loss to come in at Rs 1,187 crore.
Net interest income or NII (the difference between interest earned and paid) fell 26 percent to Rs 2,563.85 crore from Rs 3,469 crore in the year-ago period. A Reuters poll estimated an NII decline of 22 percent to Rs 2,699 crore.
Other income declined 21.5 percent to Rs 1,375.23 crore in Q4 from Rs 1,754 crore in Q4 FY17. It was projected to fall by 67 percent to Rs 1,052 crore.
Bank of India’s loss has taken the total loss posted by the public sector banking system so far this quarter to Rs 54,000 crore. The Reserve Bank of India’s revised bad loan resolution framework on February 12 have magnified the losses.
Provisions and NPAs
During the quarter under review, total provisions jumped 41 percent to Rs 6674.12 crore from Rs 4,736.21 crore a year ago. The poll estimated it to decline by nearly 50 percent to Rs 3,175 crore.
Gross non-performing asset (GNPAs) ratio to the total loans worsened to 16.58 percent in Q4 from 13.22 percent a year ago. It improved marginally from 16.93 percent as on December quarter.
Net NPAs stood at 8.26 percent from 10.29 percent as on December end 2017 and 6.90 percent as on March-end 2017.
A Motilal Oswal report expected the gross NPA ratio to be at 15.7 percent while net NPAs to be at 7.8 percent.