New Delhi, May 28 () Federal Bank on Thursday reported 21 per cent decline in standalone net profit at Rs 301.23 crore for March quarter 2019-20 on higher provisions for bad loans and contingencies arising out of COVID-19 crisis.
The lender posted a profit of Rs 381.51 crore for January-March 2018-19.
Income during the latest March quarter however increased to Rs 4,107.95 crore as against Rs 3,444.04 crore in the year-ago same period, Federal Bank said in a regulatory filing.
The bank's provisions for bad loans and contingencies more than doubled to Rs 567.50 crore during the quarter ended March 2020 from Rs 177.76 crore parked aside for the year-ago same period.
In 2019-20, the bank's net profit (standalone) rose by 24 per cent to Rs 1,542.78 crore as against Rs 1,243.89 crore in 2018-19.
Income during the year grew at Rs 15,142.16 crore from Rs 12,770.05 crore in FY19.
Gross non-performing assets (NPAs) of the bank fell to 2.84 per cent of the gross advances as on March 31, 2020 from 2.92 per cent by the year-ago same period.
In absolute terms, gross NPAs or bad loans were worth Rs 3,530.83 crore by end of March 2020, as against Rs 3,260.68 crore.
Net NPAs also came down to 1.31 per cent (Rs 1,607.17 crore) from 1.48 per cent (Rs 1,626.20 crore).
Federal Bank said the extent to which the COVID-19 pandemic will impact its results will depend on future developments, including among other things, any new information concerning the severity of the pandemic and action to contain its spread or mitigate its impact whether mandated by the government or the lender.
"The bank's capital and liquidity position is strong and would continue to be the focus area for the bank during this period," it said.
Federal Bank said it is providing relief to eligible borrowers also under the moratorium scheme extended till August now, as per RBI guidelines, due to the coronavirus pandemic.
In accordance with the RBI guidelines, the bank is required to make provision at 10 per cent of outstanding advances over two quarters beginning with latest March quarter in respect of such borrowers whose accounts, though classified as standard as on March 31, 2020, would have become non-performing but for these benefits/relaxations extended as per RBI guidelines.
"The Bank, as a prudent measure, has made the entire 10 per cent provision amounting to Rs 30.26 crore in the current quarter," it said.
Further, in addition to this, the bank has made additional provision of Rs 63.03 crore as at March 31, 2020 against the likely impact of COVID-19 pandemic in respect of exposure of the bank to certain specified sectors based on assessment of presently available information, Federal Bank said.
It also said the Board of Directors of the Bank has not recommended any dividend for 2019-20, as per RBI guidelines, in order to conserve capital in the wake of the pandemic.
Federal Bank stock closed 4.27 per cent higher at Rs 42.75 on BSE. KPM ANU ANU
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