Andhra Bank profit falls 75% in March quarter

The public sector lender posted a net profit of Rs.88 crore in the fourth quarter, compared with Rs.344.6 crore in the corresponding period of the previous year 

Hyderabad: Andhra Bank on Friday reported a net profit decline of 75% after setting aside more money to cover bad loans in the three-month period ended 31 March.

The public sector lender posted a net profit of Rs.88 crore in the fourth quarter, compared with Rs.344.6 crore in the corresponding period of the previous year. Revenue, or interest- and non-interest income combined, rose 9.3% to Rs.4,057.9 crore from Rs.3,713 crore.

For the full year ended March, net profit dropped 66% to Rs.435.6 crore, compared with Rs.1,289.1 in the previous year. Revenue grew 12% to Rs.15,630 crore.

 

Provisioning expenses of the bank more than doubled to Rs.666.7 crore in the fourth quarter.

Gross non-performing assets (NPAs) of the bank stood at Rs.5,858.46 crore, which is 5.29% of total advances. The total advances of the bank grew 10.5% to Rs.1,10,649 crore.

“Due to weak macroeconomic scenario and political unrest in Andhra Pradesh, the bank has gone through a tough phase,” said S..K Kalra, executive director of Andhra Bank.

Andhra Pradesh, which accounts 50% of the bank’s business, has been through prolonged political unrest and shutdowns by pro-Telangana statehood and united Andhra Pradesh groups. Telangana and residual Andhra Pradesh will officially come into existence on 2 June. Andhra Bank is the lead bank that heads the state level bankers’ committee.

Kalra said the bank is in the process recovering most of the loans that turned bad.

“Andhra Bank asset quality pressure is part of broader trend of a weakening economy,” said Vaibhav Agrawal, vice-president, research-banking at Mumbai-based brokerage house Angel Broking Ltd.

Shares of Andhra Bank grew 2.45% to close at Rs.64.80 on BSE, while the benchmark Sensex gained by 2.91% to 22,994.23 points

 Source-livemint.com

                     By
Shah Mohammad Abdul Qadir
        PGDM 1st year
IIMT College Of Management
      Greater Noida, U.P.