Mumbai, Feb 11 (IANS) Lender IDBI Bank on Tuesday announced that its net loss during the third quarter ended December 31, 2019, has widened to Rs 5,763 crore “on account of the bank exercising the option of lower tax resulting in one-time reversal of DTA (Deferred Tax Asset)”.
According to IDBI, its net loss widened to Rs 5,763 crore from a net loss of Rs 4,185 crore reported for the same period of the previous financial year.
“During the quarter, bank exercised the option of a lower tax rate taking a one-time hit of Rs 6,273 crore,” the bank said in a statement.
“Excluding the impact of this one time additional hit, bank would have reported net profit of Rs 418 crore against the net loss of Rs 5,763 crore being reported for the current quarter.”
However, the bank’s net interest income for the quarter in consideration improved by 13 per cent to Rs 1,532 crore, as against Rs 1,357 crore for corresponding quarter of the last fiscal.
Besides, the lender’s gross non-performing assets (NPAs or bad loans) and net NPA ratios improved. The net NPAs reduced to Rs 6,805 crore as on December 31, 2019, from Rs 21,360 crore as on December 31, 2018, and Rs 7,919 crore as on September 30, 2019.
“Provision Coverage Ratio (including technical write-fffs) improved to 92.41 per cent as on December 31, 2019, from 75.21 per cent as on December 31, 2018, and 91.25 per cent from September 30, 2019,” the statement said.
“First Time NPAs reduced to Rs 2,113 crore in Q3-2020 from Rs 2,211 crore in Q3-2019 and Rs 2,059 crore in Q2-2020.”
Besides, recovery from NPAs stood at RS 3,136 crore in the third quarter.
The better-than-expected operating profit for the third quarter, which improved by 76 per cent to Rs 1,278 crore, as against Rs 725 crore for the same quarter of last fiscal, might enhance the bank’s attractiveness for divestment.
On February 1, Finance Minister Nirmala Sitharaman proposed the sale of the government’s entire stake in the bank to private players.
The government, a promoter, holds around 46.5 per cent stake in IDBI Bank.
In September 2019, state-run Life Insurance Corporation of India and the government together infused Rs 9,300 crore as equity capital into the bank.