IDBI Bank Q1 net jumps 318%

LIC-controlled IDBI Bank on Wednesday reported a 318 percent year-on-year rise in net profit at Rs 603.3 crore for the June 2021 quarter, as bad loans declined compared to Rs 144.4 crore in the year-ago quarter.

The bank's net interest income (NII), or the interest earned minus interest expended, grew 41 per cent year-on-year to Rs 2,506 crore against Rs 1,772 crore. Its net interest margin (NIM) improved by 125 basis points to 4.06 per cent for the quarter, as compared to 2.81 per cent.

The bank's asset quality improved with gross non-performing assets (NPAs) falling to 22.71 per cent of the gross advances as of June 30, 2021 from 26.81 per cent in June 2020. Net NPAs came down to 1.67 per cent from 3.55 per cent. The bank's provisions for bad loans and contingencies stood at Rs 1,751.80 crore in the June quarter, up substantially from Rs 888.05 crore in the year-ago period. Provision coverage ratio—including technical write-offs— improved to 97.42 per cent as on June 30, 2021 from 94.71 per cent as on June 30, 2020.

As on June 30, 2021, the bank had Covid-19 related provisions of Rs 863 crore (other than provisions held for restructuring under Covid-19 norms). The provision made by the bank is more than the minimum

required as per the RBI guidelines, it said in a release.

The bank is progressing on realising business synergies with the LIC. For the quarter, the bank has done a premium collection of Rs 32 crore for the LIC and earned a fee income of Rs 5 crore, it said.