YES Bank Q1 profit tanks 91% YoY to Rs 114 crore as provisions spike 3 times
Gross NPAs for the June quarter spiked to 5.01% against 3.22% in the March quarter.
Analysts in an ET NOW poll were projecting a profit of Rs 164 crore.
The private lender had reported a profit of Rs 1,260 crore in the same quarter last year.
Total provisions came in at Rs 1,784.1 crore, up three times over Rs 625.70 crore made in the same quarter last year. The bank made Rs 3,661.70 crore provisions in the March quarter.
Net interest margin (NIMs) in the June quarter was at 2.8 per cent against 3.1 per cent in the March quarter and 3.3 per cent in the year-ago period.
Gross non-performing assets for the quarter spiked to 5.01 per cent against 3.22 per cent in the March quarter and 1.31 per cent in the year-ago period.
The bank said net provisions at Rs 1,784 crore for June quarter included one-off impact of Rs 1,109 crore of investment MTM provision led by rating downgrades of investments in companies of two financial services groups.
"This was a ‘quarter of consolidation’ in which the bank has demonstrated strong resilience in revenues and asset quality. We believe that earnings trajectory should strengthen significantly from hereon. The Bank continues to reinforce its Digital leadership and continues to win marquee mandates on the back of it," the bank’s management said.
During this quarter, the bank sold and transferred securities from the HTM category exceeding 5 per cent of the book value of investment.
The book value of HTM investment sold during the quarter was Rs 9,967.24 crore.
The market value of investments (excluding investments in subsidiaries) under HTM category as of June 30, was Rs 37,614.72 crore and was higher than the book value.
The bank said it, with the assistance of a external firm, is continuing to analyse the allegations in the whistleblower complaint and work is currently ongoing. Based on work done and findings till date, the bank has not identified any material financial statement implications, YES Bank said.