Syndicate Bank stock falls to nine-year low after lender reports highest ever quarterly loss

Bussiness

The Syndicate Bank stock fell to more than a nine-year low level in trade on Wednesday after the public sector lender reported its biggest ever quarterly net loss of Rs 2,195.12 crore in Q4 ended March 31, due to high bad loans that required higher provisioning. The bank had posted a net profit of Rs 103.84 crore in the corresponding January-March quarter of 2016-17. In December quarter, the lender posted a net loss of Rs 869.77 crore.

At 3:17 pm, the stock was trading 12.30 percent lower at 43.85. The stock hit a fresh 52-week low of 43.60  or falling 12.80 percent intra day in trade today. The stock closed  12.10 percent or 6 points lower at 43.95 level on BSE.

The stock has been losing for the last two days has fallen 14.67% during the period. The stock is down 45.06% since the beginning of this year.  The stock has lost 51.65% during the last one year.

On the BSE, the market capitalisation of the stock stood at Rs 6214 crore.

The bank’s net loss after tax at Rs 2195.12 crore has fallen 850.4% over average net loss after tax of the previous  four quarters of Rs 230.97 crore.

The bank’s provisioning requirement for bad assets was raised by nearly three times during the March quarter to Rs 3,544.68 crore as against Rs 1,192.54 crore in the same period previous fiscal, the lender said.

Income during January-March period came down to Rs 6,046 crore from Rs 6,913.09 crore earned in same period of previous fiscal.

For the full year ended March 2018, the bank reported a net loss of Rs 3,222.84 crore against a net profit of Rs 358.95 crore in 2016-17.

Income for the year fell to Rs 24,581.85 crore from Rs 26,461.18 crore.

On a consolidated basis, the Manipal-headquartered lender suffered a net loss of Rs 3,111.69 crore against net profit of Rs 517.45 crore a year ago.

Full year provisioning for bad loans rose to Rs 7,620.08 crore from Rs 3,545.44 crore.

Asset quality of the bank worsened as gross non-performing assets (NPAs) hit 11.53 per cent of gross advances (Rs 25,758.60 crore) by end of March 2018 from 8.50 per cent (Rs 17,609.31 crore) as on March 31, 2017.

Net NPAs grew to 6.28 per cent (Rs 13,239.46 crore) from 5.21 per cent (Rs 10,410.98 crore).

In respect of certain NPA accounts under Insolvency and Bankruptcy Code (IBC), the requirement of provisions is reduced from 50 per cent to 40 per cent. The bank, however, has maintained the provision at 50 per cent in respect of secured portion, it said.

Detailing about the NPA divergence for 2016-17, the bank said its balance sheet has witnessed a gap of Rs 2,336.70 crore in terms of gross NPAs (Rs 1,724.20 crore for net NPAs), while for divergence for provisioning it stood at Rs 612.50 crore. This divergence resulted in adjusted loss of Rs 253.55 crore for the fiscal ended March 2017.

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