Central Bank of India shares in focus as bank classifies Go First loans as NPAs

Shares of Central Bank of India Ltd, which fell 9 per cent on Monday, would be in focus today amid reports that suggested the public sector bank has categorised its Rs 2,000 crore loans to Go First as non-performing assets (NPAs).

As per the ET, against an exposure of Rs 2,000 crore, over Rs 600 crore is covered under the Emergency Credit Line Guarantee Scheme by the government. Central Bank of India, the ET report suggested, previously made provisions in the standard asset category on expectations of stress  and future issues. With the corporate account now classified, the ET report suggested that the provision led to a write-back, resulting in a 100 per cent provision for that account.

Investors would also be keenly tracking shares of Bank of Baroda, another bank with good exposure to Go First. 

Central Bank of India last week reported a 90.25 per cent YoY surge in net profit at Rs 605 crore for the September quarter compared with Rs 318 crore in the corresponding quarter last year. Net interest income (NII), the bank said, grew 10.23 per cent to Rs 3,028 crore from Rs 2,747 crore YoY. The bank said its net interest margin (NIM) for the quarter stood at 3.43 per cent against 3.44 per cent YoY.

Return on assets (ROA) improved to 0.62 per cent against 0.35 per cent YoY  while return on equity (ROE) improved to 2.31 per cent against 1.31 per cent YoY. Central Bank had a network of 4,489 branches, with 65.22 per cent or 2,928 branches in rural & semi-urban areas as on September 30. It had 4,044 ATMs and 10,962 BC Points with total 19,495 Touch Points as on September 2023.

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