Allahabad Bank logs Rs 128 cr profit in Q1; okays raising Rs 2,000 cr equity capital through QIP

New Delhi: State-owned Allahabad Bank on Wednesday registered a net profit of Rs 128 crore for the June quarter of the ongoing financial year as provisioning for bad loans fell substantially. The bank had posted a net loss of Rs 1,944.37 crore in the year-ago period. It reported a loss of Rs 3,834.07 crore in the preceding March quarter. Total income was down at Rs 4,747.49 crore in June quarter of 2019-20, as against Rs 4,794.04 crore in the same quarter of the last fiscal, the bank said in regulatory filing. The bank’s provisions for bad loans fell to Rs 1,102.30 crore for the quarter under review from Rs 2,590.37 crore parked aside for the year-ago period. Gross non-performing assets (NPAs) jumped to 17.43 percent of gross advances as on 30 June, 2019, compared with 15.97 percent at the end of June last year. Gross NPAs stood at 17.55 percent at March-end 2019. [caption id=“attachment_4469065” align=“alignleft” width=“380”] Representational image. Reuters.[/caption] But, net NPAs or bad loans fell to 5.71 percent at June end 2019 from 7.32 percent as on 30 June, 2018. Compared sequentially, net NPAs rose from 5.22 percent as on 31 March, 2019. Regarding accounts covered under provisions of Insolvency and Bankruptcy Code (IBC), the bank has made additional provision of Rs 749.51 crore as at 31 March, 2018, it said. Hence, for 2018-19 and quarter ended June 2019 no additional provisioning was required as per the RBI norms. “However, an amount of Rs 874.62 crore was additionally provided on account of the declaration of fraud in loan account in power and steel sector during second quarter of current financial year,” Allahabad Bank said. Besides, the bank has reported one loan account in the power and steel sector under borrowal fraud category to RBI during the second quarter of the current fiscal involving an amount of Rs 1,774.82 crore outstanding as on 30 June, 2019. “The account was already under NPA category since 2016-17 and provision amount to Rs 1,774.82 crore was held in the account as at June-end. This is a consortium advance of 33 lenders which is near resolution stage under NCLT,” the bank said. Also, up to quarter ended 30 June, 2019, 353 operational fraud cases were reported involving a total amount of Rs 73 crore. Out of these accounts, the bank has recovered a total of Rs 13.69 crore and has written back provision of Rs 9.42 crore during the quarter, it added. The bank’s non-performing loan provision coverage ratio stood at 78.58 percent as on 30 June, 2019. Stock of Allahabad Bank closed at Rs 36.85, down 5.63 percent on BSE. Meanwhile, the bank said it will raise an equity capital of up to Rs 2,000 crore through qualified institutional placement (QIP). “The share issue and allotment committee of the board of directors in its meeting held on date has accorded approval for raising equity capital of the bank by an amount aggregating up to Rs 2,000 crore,” the bank said in a regulatory filing. (With PTI inputs)