Yes Bank posts ₹2,629 crore Q4 profit due to AT1 bond write down
Deposits continue to erode; capital adequacy below regulatory requirement
Private sector lender Yes Bank reported ₹2,629 crore net profit for the quarter ended March 31 as compared to ₹1,507 crore loss during the same period of the previous year. The increase in profit is due to an extraordinary gain of ₹6,297 crore (net of tax) due to write down of additional tier-1 bonds of ₹8,415 crore.
Excluding the extraordinary gain, the bank posted a loss of ₹3,668 crore loss for the quarter ended March 31.
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Provisions for the quarter stood at ₹4,872.34 crore as compared to ₹3,661.70 crore during the fourth quarter of 2018-19.
Provision for investments jumped to ₹3,336 crore during the quarter as compared to ₹243 crore which includes ₹1,228 crore provisioning on exposure to a housing finance company, which is now 100% provided for, the bank said. Another ₹2,012 crore provision was on exposure to various entities of a ‘Diversified Conglomerate’.
The COVID-19 related standard asset provision was ₹238 crore.
Gross non-performing assets as a percentage of total advances was 16.8% as on March 31 as compared to 3.22% a year ago but lower than 18.87% of end December.
The net interest income of the bank fell 49% on year to ₹1,274 crore while non-interest income grew by 12% to ₹597 crore.
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The net interest margin for the quarter was 1.9% as compared to 3.1% a year ago and 1.4% in the third quarter.
The lender deposit deposit base has seen a sharp reduction from ₹209,497 crore from September 30, 2019 to ₹165,755 crore as on December 31, 2019 and further to ₹105,364 crore as on March 31 and ₹102,717 crore as on May 2, 2020.
Advances also declined by 29% on year and 8% sequentially 171,443 crore.
The capital adequacy ratio of the bank continued to fall below the minimum regulatory requirement though improved on a sequential basis due to capital infusion by the new shareholders. The capital adequacy ratio as on end March was 8.5% as compared to 4.1% reported at the end of December.
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