Mumbai, Feb 5 (PTI)A massive spike in bad loans pulled down Ujjivan Financial Services, holding company of Ujjivan Small Finance Bank, net profit by 33.3 per cent to Rs 29.32 crore in the quarter to December.
Gross non-performing assets soared to 4.24 per cent in the reporting period from a low 0.25 per cent a year ago, while net NPAs jumped to 4.99 per cent from 0.05 per cent in the same period last year, impacting the overall bottomline.
This has whittled down the massive gains it made by way of lower credit cost and lower interest cost, the bank said today. Similarly, the key net interest margin declined to 11.79 per cent in the quarter from 13.22 per cent.
Ujjivan Financial Services gross loan book grew 7.71 per cent to Rs 7,095.28 crore, while disbursement rose 28.35 per cent to Rs 2,134.32 crore.
"After the first two quarters, when we took the impact of demonetisation into our books, we have turned around in the third quarter and made profit," Sudha Suresh, managing director and chief executive said in a statement.
It had posted net losses of Rs 74.94 crore and 11.95 crore, respectively, during the first two quarters of FY18.
"The impact of demonetisation had not settled in the third quarter of last fiscal year and we were very profitable.
However, the impact on the portfolio quality and, therefore, the dip in profitability started from the fourth quarter of FY17 and continued till the end of second quarter of FY18," he said. Profit was boosted by a Rs 60 crore savings from lower credit cost as well as lower finance cost after it retired some of its high cost borrowings, he said. "Credit costs are trending down quarter on quarter as the note-ban impact has largely been provided for," said Suresh, adding, "going forward there would be improvement in profitability."
Its scrip ended at Rs 346.65 on the BSE, down 2.84 per cent against the benchmark Sensex which dipped 0.88 per cent. PTI HV SS BEN SS
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