IDBI Bank Limited provides personalised banking and financial solutions to clients. Its segments comprise of wholesale banking, retail banking and treasury services. The corporate/wholesale banking segment comprises of corporate relationship involving deposit and credit activities,w hile the retail banking segment includes credit and deposit activities oriented towards individuals and small businesses.
The retail banking segment also encompasses payment and alternate channels, such as automated teller machines (ATMS), point of sale (POS) machines, internet banking, mobile banking, third party distribution and transaction banking services. The bank’s treasury services segment include trading portfolio of investments, money market operations, derivatives trading and foreign exchange operations on the account and for customers.
On the financial front, IDBI Bank posted 14.05 per cent decline in its interest earned to ₹6,004.32 crore in the second quarter of FY18 as against ₹6,985.62 crore in the same quarter of FY17. The bank’s operating profit increased by
81.75 per cent to ₹2,798.23 crore in the second quarter of FY18 as compared to ₹1,539.64 crore in the same quarter of the previous fiscal. However, the bank posted a drastic decline in its profit after tax from ₹55.52 crore in the second quarter of FY17 to a net loss of ₹197 crore in the second quarter of FY18.
On an annual basis, the bank’s interest earned decreased by 0.90 per cent to ₹27,791.37 crore in FY2017 as against ₹28,042 crore in the previous fiscal. The bank’s operating profit declined by 14.74 per cent to ₹4,578 crore in the financial year 2017 as compared to ₹5,370 crore in the previous financial year.
Further, the bank’s net loss increased from ₹3,664 crore in the previous fiscal to ₹5,158.14 crore in FY2017. We recommend investor-readers to Hold the stock.