Bank of India on Thursday swung to a profit of Rs 251.79 crore for the three months to March against a loss of Rs 3969.27 crore Q4FY18.
The bottom line was driven by strong net interest income growth and a sharp drop in provisioning for bad loans. The state-run lender witnessed a 57.72 per cent y-o-y rise in net interest income (NII) to Rs 4,044 crore. Meanwhile, provisions fell 71.57 per cent y-o-y to Rs 1,897.43 crore.
The bank came out of the Prompt Corrective Action framework in January this year. NII is the difference between interest earned and interest paid by a bank.
BOI shares ended up 1.94 per cent for the session, following the earnings announcement, settling at Rs 81.65 per share.
The public sector lender witnessed an improvement in asset quality. At the end of March 31, 2019, the bank’s gross and net NPAs stood at 15.84 per cent and 5.61 per cent against 16.31 per cent and 5.87 per cent as of December 31, 2018, respectively.
While the bank’s slippages during Q4FY19 stood at Rs 3,102 crore, it also managed recoveries worth Rs 1,982 crore, made upgradations worth Rs 4,77 crore while write-offs were at Rs 780 crore.
The bank sold assets worth Rs 17,000 crore to asset reconstruction companies during the previous financial year.
It has set further identified assets worth Rs 30,000 crore for sale, possibly after Q1FY20, managing director and chief executive officer Dinabandhu Mohapatra said at a post-earnings conference.
Elaborating on the bank’s asset portfolio, the management said the bank’s SMA2 book stood at Rs 8,200 crore.