Karnataka Bank Q4 profit dip 55.76%

Image of a Karnataka Bank branch
Image Source: The Economic Times

A 55.76% decline in profits was recorded by the Karnataka Bank Ltd. The bank registered a net profit of only Rs 27.31 crores in the fourth-quarter of 2019-20. Compared to the net profit of Rs 61.73 crore in the fourth quarter of fiscal 2018-19, the more recent registered profit shows a stark decline.

The Karnataka Bank Ltd’s board of directors met on Saturday to discuss the audited financial result for 2019-20.

The gross Non-Performing Assets of the bank stand at 4.82% during Q4 of fiscal 2019-20. In contrast to the profit trend, the NPA trend shows an increase from 4.41% to the 4.82%. The net NPA stood at 3.08%, versus the previous 2.95%.

In addition, provisions, keeping tax aside, and contingencies have increased to Rs 356.50 crore during Q4 of 2019-20. Against the Rs 217.73 crore in Q4 of fiscal 2018-19, this is again an unfortunately large increase.

The previous financial year was challenging; however, CEO Mahableshwara MS is confident that the bank shall continue to sail smooth.

The bank has since shifted focus to improving the Provision Coverage Ratio (PCR). The PCR for Karnataka Bank has improved from 58.45% last fiscal to 64.70% as of March 31,2020.

The Net Interest Income (NII) of the bank was Rs 529.3 crore and other income stood at Rs 440.37 crore. The Net Interest Margin was at 2.87% during the quarter.

On the positive side, the bank recorded a net profit of Rs 431.78 crore for 2019-20.

In addition to faith in its smooth sailing, Mahabaleshwara also said that the bank is committed to ‘conserve, consolidate and emerge stronger”, in light of the COVID-19 pandemic.

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