The lender’s net interest income rose 16% year-on-year to Rs 2,866 crore, while net interest margin stood at 7.6%.
Indian private lender Bandhan Bank on Friday reported a 93% drop in fourth-quarter net profit as it increased provisions and wrote off bad loans.
The Kolkata-based bank’s net profit stood at Rs 54.63 crore ($6.56 million) in the three months ended March 31, down from Rs 808 crore in the same quarter a year ago.
Bandhan Bank’s provisions and contingencies rose to Rs 1,774 crore from Rs 735 crore a year earlier.
The bank has written off bad loans worth Rs 3,850 crore in the January-March period, compared to none in the last four quarters.
These were loans made to small borrowers during the pandemic and were backed by a government guarantee.
However, the loans were under investigation by the National Credit Guarantee Trustee Company, a government-established agency, the bank said, that could delay the disbursement of the government guarantee.
The bank called the write-offs a ‘prudent measure’.
The gross non-performing asset ratio – a key measure of asset quality – improved from 7.02% at the end of the previous three months to 3.84% at the end of March, due to the write-downs.
Bandhan Bank is set to undergo a management transition after Managing Director and Chief Executive Chandra Shekhar Ghosh said he would retire on July 9 after nearly a decade at the helm.
The lender’s net interest income rose 16% year-on-year to Rs 2,866 crore, while net interest margin stood at 7.6%.
Loans grew by 14.3%, while deposits increased by 25%.
The bank’s shares closed 0.9% higher on Friday, ahead of the results.
First print: May 17, 2024 | 5:37 PM IST