New Delhi: Public sector lender Indian Bank on Monday registered a rise of 11.45 per cent in net profit at Rs 451.54 crore for the September quarter as bad loans declined although provisioning to cover for such assets was raised.
The bank had made a net profit of Rs 405.14 crore in the similar July-September quarter of 2016-17. Total income of the bank increased to Rs 4,874.16 crore for the quarter under review of 2017-18, up from Rs 4,579.01 crore in the same quarter of the previous fiscal, the bank said in a regulatory filing.
The lender improved on its asset quality with the gross non-performing assets (NPAs) coming down to 6.67 per cent of the gross advances as on end-September 2017, as against 7.28 per cent by September 2016.
Net NPAs of bad loans too fell to 3.41 per cent of the net advances at the end of second quarter this fiscal, from 4.62 per cent in the year-ago corresponding period.
Bank's provisioning for bad loans and contingencies was raised to Rs 744.55 crore for the quarter, up from Rs 478.27 crore for the same period a year earlier. Provisioning for bad loans alone stood at Rs 633.36 crore, up from Rs 616.44 crore as on September 30, 2016.
The bank said it was required to made an additional provision of Rs 357.26 crore to be spread over three quarters starting from July-September 2017-18 against eight borrowal accounts covered under the provisions of Insolvency and Bankruptcy Code (IBC).
"Accordingly, additional provision of Rs 119.08 crore has been made during the quarter, leaving a balance provision of Rs 238.18 crore to be proportionately spread over remaining two quarters ie December 2017 and March 2018," it said.
Stock of the bank jumped 9.30 per cent at Rs 379.50 apiece on BSE post earnings announcement.