TRIC
HUR: The South Indian Bank (SIB) move to focus more on retail portfolio has started yielding result with the bank reporting a net profit of Rs84.48 crore for the quarter ending September 30, 2019 compared with Rs70.13 crore for the same period last year.
The corporate portfolio continues to be a thorn in the flesh for the bank contributing loss (before tax) of Rs173.15 crore for the said period growing manifold from a loss of just Rs5.33 crore a year ago.
On the other hand, the retail portfolio has been helping the bank like an anchor, contributing this time a profit (before tax) of Rs178.17 crore to the bottom line – almost doubling the profit posted for the same period last year.
Maybe sensing the trend, the bank has further expanded the size of the retail portfolio during this quarter also, with retail loans at Rs857.94 crore surpassing the size of corporate loans portfolio at Rs823.09 crore.
While the corporate portfolio has marginally contracted from Rs828.38 crore, the retail portfolio has grown by almost 40 per cent from the level of Rs617.01 crore during the comparable period last year.
Bad loans and provisions have become a curse for SIB and the bank, for that reason, has long been punished by the market. SIB shares are being traded below one-third of its book value –maybe a rare thing by any standards.
The gross NPA of the bank has bloated further from Rs2646.15 crore to Rs3145.20 crore during the past one year, whereas the net NPA also inched up from Rs1784.72 crore to Rs2193.15 crore during the period.
The bank had to raise provisions against NPA from Rs204.68 crore to Rs306.34 crore during the quarter thus making and this has certainly impacted the profitability of the bank this time too. The total assets of the second largest bank in the state has stood at Rs94,955.35 crore during the period under discussion.
