INSUBCONTINENT EXCLUSIVE:
Kolkata: Allahabad Bank reported a net loss of Rs 3,510 crore in the fourth quarter owing to higher loan risk coverage as well as taking
cover against frauds involving Punjab National Bank and diamond trader Nirav Modi.
The bank posted net profit of Rs 111 crore in the
year-ago period.
In a regulkatory filling to stock exchanges, the bank said it had fully provided for the entire funded exposure in respect
of two gems and jewellery borrower group, where fraud was declared by some banks.
It did not mention what was its exposure to these specific
fraud case but said 43 fraud cases were reported in FY18 involving a total amount of Rs 1525 crore which were fully covered by
provisions.
This is the second quarterly loss in a row for the Kolkata-based state-owned bank taking the annual loss at Rs 4674 crore
Higher provisions against sticky loans referred to bankruptcy courts contributed to the loss
The bank's operating profit fell 89 per cent at Rs 123 crore in the fourth quarter compared with Rs 1066 crore in year ago period, owing to
dip in treasury income and higher loss in wholesale banking
Its gross NPA ratio slipped to 15.96 per cent as on March 2018, from 14.38 per cent a quarter ago and from 13.09 per cent a year back.
The
bank said Reserve Bank of India's revised rules on stressed assets resolution and scrapping of all past loan restructuring schemes also
contributed to the rise in non-performing assets.
Provision against sticky loans and other contingencies rose to Rs 4783 crore in the fourth
quarter from Rs 1430 crore in the year ago period
The bank said provision coverage ratio improved to 62.91 per cent in FY18, up from 50.11 per cent in FY17.
The loss squeezed the capital of
the bank with capital adequacy ratio shrinking to 8.69 per cent from 11.45 per cent a year ago.
