India's Bandhan Bank posts slide in Q4 net profit on write-offs, higher provisions

Bandhan Bank

17/05/2024 12:29

MUMBAI, May 17 (Reuters) - Indian private lender Bandhan
Bank  BANH.NS  reported a 93% drop in fourth-quarter net profit
on Friday as it increased provisions and wrote off bad loans.
    The Kolkata-based bank's net profit stood at 546.3 million
rupees ($6.56 million) in the three months ended March 31, down
from 8.08 billion in the same quarter a year ago.
    Bandhan Bank's provisions and contingencies jumped to 17.74
billion rupees from 7.35 billion rupees a year earlier.
    The bank wrote off bad loans worth 38.5 billion rupees in
the January-March period, compared with none in the past four
quarters.
    These were loans given to small borrowers during the
pandemic and were covered by a government guarantee.
    However, the loans were being examined by the National
Credit Guarantee Trustee Company, an agency set up by the
government, the bank said, which could delay a payout of the
government guarantee.
    The bank termed the write-offs as a "prudent measure".
    Its gross non-performing asset ratio - a key gauge of asset
quality - improved to 3.84% as of March-end from 7.02% at the
end of the prior three months as a result of the write-offs.
    Bandhan Bank is set to see a management transition after
Managing Director and Chief Executive Chandra Shekhar Ghosh said
he would retire on July 9, after spending nearly a decade at the
helm.
    The lender's net interest income rose 16% on-year to 28.66
billion rupees, while net interest margin stood at 7.6%.
    Its loans grew 14.3%, while deposits rose 25%.
    Shares of the bank ended 0.9% higher ahead of the results on
Friday.

($1 = 83.3322 Indian rupees)

 (Reporting by Siddhi Nayak; Editing by Sohini Goswami)
 ((Siddhi.Nayak@thomsonreuters.com; +91 22 6921 7848; Twitter: https://twitter.com/siddhiVnayak))