DCB Financial institution on Saturday reported almost 10 per cent decline in web revenue at Rs 82 crore for the quarter ended September 30, 2020 as provisions rose.
The financial institution logged a web revenue of Rs 91 crore in the identical quarter of the earlier fiscal 12 months.
“Revenue earlier than tax for the quarter was impacted by Rs 48 crore COVID-19 regulatory bundle provision. In an effort to additional strengthen the steadiness sheet, the financial institution intends to make conservative provisions given the present surroundings,” DCB Financial institution mentioned in a launch.
Whole revenue additionally fell marginally to Rs 970.98 crore in July-September 2020-21 as in opposition to Rs 980.59 crore within the year-ago identical interval.
Web curiosity revenue grew 7 per cent to Rs 334 crore, whereas the non-interest revenue fell by 9 per cent to Rs 92 crore.
DCB Financial institution mentioned it goals to take care of web curiosity revenue at comparable degree of 2019-20. Nonetheless, resulting from decrease enterprise volumes and COVID-19 disruptions, core payment revenue could decline compared to earlier 12 months.
Working bills have been up by 22 per cent at Rs 225 crore as in opposition to Rs 185 crore.
Gross unhealthy loans or non-performing belongings (NPAs) of the financial institution rose to 2.27 per cent of gross advances by the tip of September 2020 in opposition to 2.09 per cent by the year-ago identical interval. In worth phrases, it stood at Rs 573.70 crore as in opposition to Rs 523.24 crore.
Nonetheless, web NPAs improved at zero.83 per cent (Rs 205.77 crore) from zero.96 per cent (Rs 237.86 crore).
Provisions for unhealthy loans and contingencies greater than doubled to Rs 113.10 crore for the quarter from Rs 43.27 crore within the year-ago interval.
Capital adequacy continues to be sturdy and as on September 30, the CAR ratio was at 18.28 per cent (with Tier I at 14.22 per cent and Tier II at four.06 per cent as per Basel III norms).
The non-public sector lender mentioned it has been steadily rising retail time period deposits (of lower than Rs 2 crore) for the reason that final two years and lowering the majority deposits. The retail time period deposits grew 33 per cent from a 12 months in the past. Whereas the highest 20 deposits stood at 7.89 per cent.
“For the previous many months, the financial institution has been deliberately lowering bulk and interbank deposits. Throughout Q2 FY2021, inter financial institution time period deposit at Rs 2,857 crore lowered by 29 per cent as in comparison with Rs four,052 crore as at March 31, 2020. The Certificates of Deposits as on September 30, 2020 was zero,” DCB Financial institution mentioned.
The lender mentioned within the coming months it intends to concentrate on enterprise loans (mortgage in opposition to property), dwelling loans, gold loans, Kisan Credit score Card, tractor loans and short-term company loans.
Advances by the tip of the quarter have been barely up from a 12 months in the past interval at Rs 24,879 crore.
Primarily based on the present outlook, the advances for the complete 12 months could stay flat at 2019-20 degree or could de-grow barely, it added.
“We count on step-by-step enchancment in collections effectivity within the coming months. We consider ECLGS (Emergency Credit score Line Assure Scheme) is a superb scheme that’s possible to assist bridge the hole in working capital and instant monetary obligations particularly for smaller self-employed entities.
“New mortgage momentum is choosing up and our intention is to realize month-to-month volumes just like pre-COVID-l9 between March 2021 to Might 2021”, Murali M Natrajan, Managing Director & CEO, DCB Financial institution mentioned.