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Yes Bank Q4 Results: Net Loss Widens To Rs 3,788 Crore – BloombergQuint

Yes Bank Ltd. posted a wider-than-expected net loss for the quarter ended March, a year after the private lender was rescued by the banking regulator.

The lender’s net loss stood at Rs 3,788 crore compared with a net loss of Rs 3,668 crore a year ago, according to its exchange filing. Analysts estimates compiled by Bloomberg had pegged the net loss at Rs 495 crore.

Yes Bank was placed under a moratorium in March last year after which a reconstruction scheme was implemented.

Its net interest income fell 22% year-on-year to Rs 987 crore, compared with the Rs 2,176-crore forecast. Other income, however, rose 36.6% to Rs 816 crore in the fourth quarter.

Asset Quality

Gross non-performing asset ratio stood at 15.41% in the reported quarter. In the preceding three months, Chief Executive Officer Prashant Kumar had said the bank’s pro-forma gross NPA ratio was close to 20%. It had reported a gross NPA ratio of 15.36% as of December 2020.

  • During the quarter, the bank set aside Rs 5,239.6 crore in provisions to cover for bad loans, which in turn led to the large loss.
  • Post provisioning, the Net NPA ratio was at 5.88% compared with 4.04% as of December. The bank had not released its pro-forma net NPA at the end of the third quarter.

“The bank has made accelerated provisions against non-performing loans and investments, which led to the loss during the quarter,” said chief executive Prashant Kumar in a media call after the earnings. The bank’s provision coverage ratio stands at 78.6%.

  • The bank wrote-off Rs 10,300 crore during the quarter.
  • Gross slippages during the quarter stood at Rs 11,873 crore.
  • Out of the gross slippages in Q4, nearly Rs 8,200 crore worth of slippages were accounts which were not classified as NPA in the third quarter due to a Supreme Court order.
  • Loans worth Rs 1,112 crore were restructured, including Rs 940 crore in corporate loans and Rs 13.5 crore in retail loans.
  • The bank expects to restructure Rs 2,500 crore in the first quarter of the current year.

Including technical write offs, the provision coverage ratio of the bank stood at 78.6% as of March 31, marginally higher than 78% a year ago, but lower than 81.5% as of December 31.

In the current financial year, the bank expects cash recoveries of Rs 5,000 crore, with slippages coming in lower, the CEO said.

Kumar said that the bank’s plan to set-up a majority owned asset reconstruction company has not been approved by the Reserve Bank of India. The lender will await the new ARC guidelines before submitting a revised plan. The structure had been considered as a way to clean-up the bank’s balancesheet.