Public sector lender Indian Overseas Bank (IOB) has reported a standalone net profit of ₹121 crore for the first quarter ended June against a net loss of ₹342 crore in the year-earlier period on an increase in treasury gains, reduction in interest and operational expenditure. “For two quarters in a row, we have been posting profit,” said Partha Pratim Sengupta, MD & CEO, IOB said during his maiden interaction with the media after assuming the post.“Despite COVID-19 impact, we were able to maintain our profit levels,” he added.“In the last two quarters, the bank made a provision of ₹401 crore towards COVID-19. Keeping COVID-19 aside, we are also planning to recover bad debts worth ₹1,000 crore each for the next three quarters,” he said.On his priorities, he said that going forward, IOB would focus on digitalisation to attract millennials and GenY, drive MSME business and contain non-performing assets.During the period under review, total income increased to ₹5,234 crore (₹5,006 crore) mainly due to an increase in treasury income. Non-interest income grew to ₹932 crore (₹670 crore) on account of an increase in other income. Net interest margin increased marginally by 0.7% to 2.08%.In the first quarter, provisions and contingencies contracted to ₹970 crore from ₹1,170 crore. Provision Coverage Ratio improved to 87.97% from 72.24%.Gross NPAs declined to ₹18,291 crore (₹33,262 crore). Net NPAs reduced to to ₹6,081 crore ( ₹14,174 crore).While total deposits grew marginally to ₹2,25,546 crore (2,21,171 crore), there was a dip in gross advances to ₹1,31,565 crore (₹1,47,606 crore) as the bank had adopted a policy of not taking fresh exposures to stressed sectors. Besides, it also exited from accounts in these sectors to improve asset quality assets.Mr. Sengupta said during the quarter, the bank made a total recovery of ₹1,991 crore (₹2,238 crore) while slippages of ₹257 crore was mainly on account of international operations.Asked how long it would take to come out of Prompt Corrective Action (PCA) framework, he said the bank was more on track and would strive hard to maintain all the key parameters as laid down by the RBI. “Going forward, we also have to make some COVID-19 provision. We have sufficient strength and we need to discuss this issue at the board to contain the impact of COVID-19. We are not in a hurry to come out of PCA. First, we have to access our own strength and then, we will approach RBI after a few quarters.” he said.
You have reached your limit for free articles this month.
To get full access, please subscribe.
Already have an account ? Sign in
Show Less Plan
Subscription Benefits Include
Find mobile-friendly version of articles from the day’s newspaper in one easy-to-read list.
Move smoothly between articles as our pages load instantly.
Enjoy reading as many articles as you wish without any limitations.
A one-stop-shop for seeing the latest updates, and managing your preferences.
A select list of articles that match your interests and tastes.
We brief you on the latest and most important developments, three times a day.
*Our Digital Subscription plans do not currently include the e-paper ,crossword, iPhone, iPad mobile applications and print. Our plans enhance your reading experience.