SIB is back in the black; reports Rs81.65 cr Q1 profit

THRISSUR: The South Indian Bank (SIB) has bounced back to profitability as it closed the first quarter (Q1) of the financial year 2020-21 with a profit of Rs81.65 crore.

The bank had reported a profit of Rs73.26 crore for the comparable quarter last year. SIB had witnessed its first quarterly loss in its more than 9-decade-old history when it reported Rs143.69 crore loss for the fourth quarter of the previous year.

The outgoing MD and chief executive of the bank, VG Mathew had said while briefing the analysts recently on the previous year’s financial performance that the “worst is behind the bank now.” He was refering to the ever increasing provisions that have been eating into the profitability of the bank.

As if religiously ‘walking the talk’ on the future course of the bank, Mathew did succeed in bringing down the fresh slippages substantially during the quarter with the corporate slippage grinding to a halt.

The bank brought down the provision during the first quarter substantially to Rs293.68 crore from Rs723.80 crore the bank set aside for the previous quarter (Q4).

Likewise, though marginally, the bank could pare the non-performing assets (NPA) sequentially. While the gross NPA now stands at Rs 3245.44 crore or 4.93 per cent, the net NPA declined to Rs1992.86 crore, which in percentage terms dropped from 3.41 per cent to 3.09 per cent year on year.

Treasury department was the star performer this time as it contributed Rs142.64 crore (before tax) to the bottom line followed by retail portfolio at Rs134.26 crore, though the corporate book continued to be the black sheep this time too posting a loss of Rs215.73 crore (before tax).

The bank that succeeded in registering overall growth on all fronts, especially on the low cost CASA, staged an exemplary performance by improving its provision coverage ratio (PCR) by 13.7 percentage points in a matter of one year to a decent 58.8 per cent, and is now well on is course to reach 65 per cent soon.

 

 

 

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