Federal Bank reports decline in net profit to the tune of 43.5% year on year at Rs 145 crore for the quarter ended March as asset quality at the bank was hit. On the contrary, in the same period a year ago, the bank reported a whopping 2,400% jump in its net profit at Rs 256.6 crore because of reduction in NPAs and comparatively lower provisions.
On a year-on-year basis, provisions at the bank increased by as much as 203% to Rs 371.53 crore in the fourth quarter. Slippages for the quarter were Rs. 872 crore, of which Rs 492 crore came in from one account alone.
Net interest income witnessed a growth of 11% from Rs 842 crore in quarter ended March 2017 to Rs. 933.22 crore in Q4FY18.
In its statement, the bank said it has made gratuity provisions taken to the tune of Rs 18 crore in Q4 and that a similar amount will be spread over each of the next three quarters with a total of Rs 72 crore. This has come in after the government's notification to enhance gratuity ceiling for employees from the current Rs. 10 lakh limit to Rs. 20 lakh.
In the quarter, gross NPAs at the bank also increased to 3% of the total loans as against 2.52% in the quarter that ended in December and 2.33% in the same quarter a year ago.
Net NPA also spiked to 1.69% in the last quarter as against 1.36% in the quarter that ended in December and 1.28% in the same quarter a year ago.
The Board of Directors has recommended a dividend of 50% at Rs 1 per share for FY18, subject to the approval at its AGM.
The shares of the private lender ended the day with a loss of 2.27% at Rs 101.15 on the BSE.