AXIS BANK NET DIPS 43% ON HIGHER PROVISIONING

Private sector lender Axis Bank Ltd on Wednesday said that its net profit for the fourth quarter dropped 43% on higher provisioning.

Net profit for the quarter stood at ₹1,225.10 crore as compared with ₹2,154.28 crore a year ago.

A Bloomberg poll of 23 analysts had forecast a net profit of ₹872.90 crore.

Net interest income (NII), or the core income a bank earns by giving loans, increased just 3.87% to ₹4,728.60 crore from ₹4,552.59 crore last year. Other income jumped 11.85% to ₹3,013.16 crore from ₹2,694.01 crore in the same period last year.

Provisions and contingencies dropped 32% to ₹2,581.25 crore in the quarter from ₹3,795.80 crore a quarter ago. On a year-on-year basis, they surged 121% from ₹1,168.33 crore. With this, the bank’s provision coverage ratio rose to 68% from 64% on a QoQ basis.

The bank’s gross non-performing assets (NPAs) rose 3.98% to ₹21,280.48 crore at the end of the March quarter from ₹20,466.82 crore in the December quarter. On a year-on-year basis, it jumped more than tripled from ₹6,087.51 crore.

As a percentage of total loans, gross NPAs stood at 5.04% at the end of the fourth quarter, as compared to 5.22% in the previous quarter and 1.67% in the year-ago quarter. Net NPAs were at 2.11% in the March quarter compared with 2.18% in the previous quarter and 0.7% in the same quarter last year.

Shares of Axis Bank gained 0.42% to close at ₹517.30 on Wednesday on the Bombay Stock Exchange (BSE), while the benchmark Sensex gained 0.63% to close at 30,133.35 points.