Indian Overseas Bank’s Asset Quality Deteriorates Further In Second Quarter

Government-owned Indian Overseas Bank Ltd., posted a net loss of Rs 765 crore in the July-September quarter of the current financial year compared to a loss of Rs 550.83 crore in the corresponding quarter last year.

Asset Quality Woes

Gross bad loans, in absolute terms, soared to Rs 34,724 crore from Rs 33,913 crore in the same period last year. Gross non-performing assets as a percentage of total advances, increased 129 basis points to 21.77 percent from 20.48 percent in the quarter ended June 30. Net non-performing assets increased 33 basis points to 14.30 percent from 13.97 percent earlier.

Other Key Highlights

• Provision coverage ratio improved to 50.19 percent compared to 47.61 percent in the previous quarter.
• Net interest income for the quarter stood at Rs 4,199.99 crore
• Net interest margins for the current quarter stood at 2.02 percent compared to 1.87 percent in the first quarter of the current financial year.

Shares closed 2.43 percent lower at Rs 26.05 on the Bombay Stock Exchange.