Sunday, November 18, 2018

PSU banks' losses widened by 3.5 times in Q2 - economic news of india - world economic news - economics news for students - indian economy news

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PSU banks' losses widened by 3.5 times in Q2
New Delhi, Nov 18 (PTI) State-owned banks saw their cumulative losses widen nearly three-and-a-half times to Rs 14,716.2 crore in the July-September quarter of the current fiscal due to mounting bad loans.These 21 public sector banks had posted a net loss of Rs 4,284.45 crore in the September quarter of 2017-18.On a quarterly basis, however, their performance was somewhat better as they narrowed down their losses by about Rs 2,000 crore to Rs 14,716.2 crore in the said quarter from Rs 16,614.9 crore in April-June 2018.Higher provisioning towards bad loans or non-performing assets (NPAs) had impacted the balance sheets of these PSU lenders.As per the financial results posted by them, the biggest loss was posted by scam-hit Punjab National Bank (PNB) Rs 4,532.35 crore in the September quarter of the current fiscal as against a profit of Rs 560.58 crore in the year-ago period.PNB's provisioning for bad loans and contingencies rose to Rs 9,757.90 crore for the quarter from Rs 2,440.79 crore a year ago. Of this, the provisions for bad loans or NPAs were Rs 7,733.27 crore as against Rs 2,693.78 crore a year ago.The India's second largest PSU bank suffered huge losses after the detection of a massive fraud to the tune of nearly Rs 14,000 crore in March quarter this year, allegedly committed by diamond jewellery designer Nirav Modi and his associates. The bank had to make provisioning for the losses.IDBI Bank posted a loss of Rs 3,602.50 crore and Allahabad Bank Rs 1,822.71 crore in the September quarter. IDBI Bank's loss was Rs 197.84 crore in the year-ago quarter while Allahabad Bank had posted a profit of Rs 70.2 crore.The narrowing of the cumulative net losses on quarter-on-quarter basis could be mainly attributed to good performance by State Bank of India and Oriental Bank of Commerce.SBI, which had incurred a net loss of Rs 4,875.85 crore in the June quarter, posted a profit of Rs 944.87 crore for July-September. Oriental Bank of Commerce posted a profit of Rs 101.74 crore as against a net loss of Rs 393.21 crore in the June quarter of the current fiscal.The combined loss of these 21 banks was Rs 62,681.27 crore in the quarter ending March 2018.The government and the RBI have been taking steps to help the debt-ridden public sector banks to improve their performance. The government on its part has been infusing capital in these banks and the Reserve Bank of India has tightened monitoring.
Source: ET
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