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Earnings

Axis Bank reports Rs 1387.78 crore net loss in Q4FY20 as provisions spike; asset quality improves

Updated : April 28, 2020 07:19 PM IST

In the corresponding quarter last year, the bank posted a net profit of 1,505.06 crore.

CNBC-TV18 Polls had predicted a profit of Rs 1,580.1 crore for the quarter under review.

Axis Bank reported a net loss of Rs 1,387.78 crore in Q4FY20 impacted by a spike in provisions. The bank had posted a net profit of Rs 1,505.06 crore in the same quarter last year. A CNBC-TV18 poll had estimated a net profit of Rs 1580.1 crore.

Net interest income rose 19.3 percent to Rs 6,808 crore as against Rs 5,706 crore, YoY. Net interest margin came in at 3.55 percent as compared to 3.57 percent in the previous quarter.

Asset quality improved during the quarter as gross NPA as a percentage of gross advances declined to 4.86 percent from 5 percent, QoQ. Net NPA fell to 1.56 percent from 2.09 percent, QoQ.

Gross NPA increased marginally by 0.5 percent to Rs 30,234 crore versus Rs 30,073 crore while net NPA declined 23 percent to Rs 9,360 crore versus Rs 12,160 crore, QoQ.

Total slippages during Q4FY20 were at Rs 3,920 crore as against Rs 6,214 crore in the previous quarter.

"Slippages from the loan book were at Rs 3,418 crore and that from investment exposures stood at Rs 502 crore," the bank said.

Corporate slippages were at Rs 1,839 crore. Excluding one account of Rs 750 crore which got upgraded during the quarter and downgraded again out of total corporate slippages, 84 percent of this came from previously disclosed BB and below rated clients, the lender added.

Recoveries and upgrades from NPAs were at Rs 2,489 crore.

Provisions and contingencies during the quarter stood at Rs 7,730.02 crore, a significant rise of 185.1 percent YoY and 122.7 percent QoQ.

The bank made other provisions aggregating Rs 3,526 crores in Q4FY20 of which Rs 3,000 crore is towards COVID-19.

Advances grew 15 percent on year to Rs 5,71,424 crore as on March 2020, while retail loans rose 24 percent YoY to Rs 3,05,400 crore (which accounted for 53 percent of the net advances) and corporate loan book growth at 11 percent YoY to Rs 2,04,103 crore.

Capital Adequacy Ratio was at 17.53 percent versus 18.20 percent, QoQ and 15.84 percent, YoY.

Amitabh Chaudhry, CEO of Axis Bank said that the deposit book remained resilient and grew 19 percent YoY while the loan book grew by 15 percent on year.

"Our capital position remains healthy and we have one of the highest capital levels in the industry," he added.

All industries will get impacted sooner or later because of COVID19, he said adding, "We remain conservative in our approach given the heightened risks."

On the bank's loan book, Chaudhry said that the quality of its retail book is the best in class and 80 percent of the book is secured.

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