Private lender Federal Bank has reported 8 per cent decline in net profit at Rs 404 crore for the third quarter ended December 31, 2020 (Q3 FY21), as against Rs 441 crore in the same period last year due to rise in provisions and contingencies. The provisions (other than tax) and contingencies surged by 161 per cent to Rs 421 crore, from Rs 161 crore in the year-ago period.
The Kerala-based bank has posted total income of Rs 3,941.36 crore in December quarter of 2020 versus Rs 3,738.22 crore in the year ago period, registering a year-on-year (YoY) growth of 5.43 per cent.
On the consolidated basis, Federal Bank's profit was down 7.41 per cent YoY at Rs 418.14 crore, while revenue grew by 6.63 per cent yoy to Rs 4088.77 crore.
The operating profit stood at Rs 962.90 crore as against Rs 743.82 crore in the same period last year.
On the asset front, gross non-performing assets (NPAs), as a percentage of total advances, fell to 2.71 per cent in Q3 FY21 compared with 2.99 per cent in Q3 FY20. The net NPA ratio stood at 0.60 per cent against 1.63 per cent in same quarter last year. In absolute terms, gross NPAs stood at Rs 3,470.18 crore compared to Rs 3,618.69 crore in the year ago period.
On impact of COVID-19, the lender said that it will depend on various aspects including actions taken to mitigate its impact and other regulatory measures. The bank's capital and liquidity position is strong and would continue to be the focus area for the Bank during this period, it said.
In line with the RBI mandated provisions on account of COVID-19, the bank made provision amounting to Rs 587.91 crore during the quarter ended September 30, 2020. During the current quarter, the bank has utilized Rs 51.22 crore from the above provision for creation of RBI mandated provision for advances restructured under "Resolution framework for COVID-19 related stress". Hence, the aggregate provision against the likely impact of COVID-19, including the RBI mandated provision, stands at 536.69 crore as on December 31, 2020, it said.
Following Q3 results, shares of Federal Bank were trading at Rs 75.20, down 0.27 per cent, against previous closing price of Rs 75.40 on the BSE.