Central Bank of India reports higher Rs 6,430cr loss for FY19 due to NPA divergence

New Delhi, Nov 19 () Central Bank of India has reported an increased net loss of Rs 6,430.48 crore for 2018-19 due to NPA divergence after assessment of higher bad loans by the Reserve Bank.

The net NPA divergence -- the difference between the NPAs reported by the bank and that assessed by the RBI -- was at Rs 2,565 crore for 2018-19.

Central Bank of India had reported a net loss of Rs 5,641.48 crore in 2018-19 earlier.

"The adjusted (notional) net profit after tax for the year ended March 31, 2019 after taking into account the divergence in provisioning is (-) Rs 6,430.48 crore," the bank said in a regulatory filing.

Banks are required to report divergences in their asset classification and provisioning as per Sebi guidelines issued on October 31, 2019.

The bank had reported Rs 11,333.24 crore net NPAs during the year while the RBI assessed it at Rs 13,898.24 crore, leaving a gap of Rs 2,565 crore.

The divergence in provisioning also increased by Rs 788 crore for the fiscal ended March 2019.

Market regulator Sebi has put in place tighter disclosure norms, directing all listed banks to disclose any divergence in bad loan provisioning within 24 hours of receiving RBI's risk assessment report, rather than waiting to publish the details in their annual financial statements.

Banks, including Indian Bank, Union Bank of India, Bank of India, Indian Overseas Bank and Lakshmi Vilas Bank, have already reported their NPA divergences for the last fiscal.

The disclosures need to be made in case the banks' additional provisioning for non-performing assets (NPAs) assessed by the RBI exceeds 10 per cent of the reported profit before provisions and contingencies, and if the additional gross NPAs identified by the RBI exceed 15 per cent of the published incremental gross NPAs. KPM MR
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(This story has not been edited by Business Insider and is auto-generated from a syndicated feed we subscribe to.)

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