Mumbai: State-run lender IDBI Bank today narrowed its losses to Rs 1,524.31 crore in the quarter to December from Rs 2,255 crore a year ago driven by a higher margin and lower operational cost which offset a massive spike in bad loans which jumped to 25 percent.
In the September quarter, the lender had reported a net loss of Rs 198 crore. On a positive side, its net interest margin massively improved to 2.16 percent from 0.86 percent in the same quarter last fiscal.
"Lower loss has largely come from a reduction in the cost of funds and other operational expenses. Our cost of fund has come down by a massive 28 percent," deputy managing director
KP Nair told reporters here this evening. Gross NPA jumped to a high 24.72 percent in the quarter from 15.16 percent, while net NPAs rose to 16.02 percent from 9.61 percent. Fresh slippages stood at Rs 4,127 crore in the quarter.
CFO Ajay Sharma said, there are some concerns on slippages but they will come down in near future. Recovery in the quarter was to the tune of Rs 537 crore and it upgraded Rs 436 crore worth of loans.
During the quarter, the bank divested its 4.89 percent stake in Small Industries Development Bank of India (Sidbi) for Rs 616.20 crore.
The bank is also in the process of its stake sale in IDBI Federal Life Insurance. 'Expression of interest has come and that are being evaluated currently," Nair said.
So far, in this year the bank has raised Rs 2008 crore through sale of its stake in Sidbi and Clearing Corporation of India. The government has announced to infuse Rs 10,610 crore into the bank, the highest among the 20 state-run banks through recapitalisaiton bonds by March. Even the SBI is getting only Rs 8,800 crore capital infusion.
Of the Rs 10,610 crore, Rs 2,729 crore has already been received by way of preferential allotment of equity shares in December, he said.
Nair said the bank may need more capital this year and may look at QIP route but nothing has been finalised so far. The bank scrip closed at 0.98 per cent down at Rs 60.35 on the BSE which ended down 0.19 percent.
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