State-owned Bank of Maharashtra today reported a jump of 55.6 per cent in net profit at Rs 89.06 crore for the third quarter ended December 2015.
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Central Bank of India, the eighth-biggest state-run lender, smaller lenders Allahabad Bank and Dena Bank all reported net losses in the December quarter.
With stressed assets, including NPAs and restructured loans, of public sector banks rising to over Rs7,00,000 crore, Reserve Bank governor Raghuram Rajan has repeatedly been airing concern over the health of public-sector banks. As on September 2015, the gross NPAs of PSBs have increased to Rs 3,00,743 crore as against Rs 2.67 lakh crore in March 2015.
RBI has also issued fresh guidelines on asset classification and has asked banks to ensure adequate provisioning to “strengthen their balance sheets”, besides working out schemes of merger.
With gross NPAs of a couple of these banks nearing 10 per cent, the RBI could take prompt corrective action which could see restrictions being imposed on dividend payments.
Allahabad Bank wrote off Rs 2,109 crore, Central Bank of India Rs 1,995 crore, IDBI Bank Rs 1609 crore, Bank of Baroda Rs 1,564 crore, Syndicate Bank Rs 1,527 crore, Canara Bank Rs 1,472 crore and UCO Bank Rs 1,401 crore. “During the quarter, the bank has recognised deferred tax assets amounting to Rs 332.04 crore which was hitherto recognised as at the year-end, in accordance with the applicable Accounting Standards”. During the day, it surged 14.16 per cent to Rs 33.45.
Gross NPAs as a percentage to total advances rose to 6.40% from 5.46% in the same quarter year ago.
And nearly all public sector banks, with the exception of State Bank of Saurashtra and State Bank of Indore, had reported bad loans in the past five years, RBI said in response to an RTI application filed by The Indian Express.
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Besides, SBI scrip fell by 4.82% to Rs 158.95 ahead of the bank’s financial results tomorrow.
