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Thursday, January 31, 2013

Allahabad Bank net dips on higher provisioning for bad debts

Public sector lender Allahabad Bank on Thursday said that it intends to open 250 branches during the fiscal. Of these, 148 have already been opened and the bank has obtained authorisation for opening 140 more.

The bank currently has 2,664 branches.

According to Subhalakshmi Panse, Chairman and Managing Director, Allahabad Bank, the bank has also sought capital infusion of nearly Rs 1,500 crore. “We have applied to the government for capital infusion,” she told reporters at a press conference.

Net profit dips

The bank, meanwhile, reported a near 45 per cent dip in net profit to Rs 311 crore for the quarter ending December. Its net profit stood at Rs 560 crore for the corresponding quarter last fiscal.

The net non-performing assets (NPA) or bad loans increased to 2.06 per cent (0.79 per cent).

During the quarter, total income stood at Rs 4,735 crore (Rs 3,912 crore).

According to Panse, a higher provisioning for bad debt and non-performing assets, standard restructuring and provisions for wage revision of employees impacted net profit.

“Apart from higher provisioning for NPAs, the RBI has recently mandated higher provisioning for standard restructuring for which we have to set aside an additional Rs 93 crore in the third quarter,” she said.

Provisions against bad loans stood at Rs 432 crore (Rs 421 crore). Operating expenses increased 16 per cent to Rs 811 crore.

On Thursday, Allahabad Bank stock was trading at around Rs 163.50, down 2.15 per cent on the BSE.

Source: thehindubusinessline


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