This Article is From Jul 17, 2019

Yes Bank June Quarter Profit Slumps 91% On Higher Provisioning: 10 Points

Yes Bank profit slumped to Rs 113.76 crore in June quarter from profit of Rs 1,260.36 crore in the same period last year.

Yes Bank June Quarter Profit Slumps 91% On Higher Provisioning: 10 Points

Yes Bank's bad loans in the June quarter rose sharply on quarterly basis.

Yes Bank on Wednesday reported a net profit of Rs 113.76 crore for the April-June quarter, missing analysts' estimates. That marked a fall of 91 per cent compared with its profit of Rs 1,260.36 crore reported for the corresponding quarter a year ago. Analysts had on an average expected the bank to report a profit of Rs 279 crore for the three-month period ended June 30, news agency Reuters reported citing Refinitiv data. The net profit was impacted on account of higher provisioning for bad loans, the private sector bank said in a stock exchange filing after market hours.

Here are 10 things to know:

  1. Yes Bank's asset quality worsened in the quarter ended June 30 as its bad loans ratios rose sharply on a quarterly basis. 

  2. Analysts said the earnings miss might trigger some correction in the stock in the near term.

  3. "Yes Bank quarterly numbers are bad. We had expected the bank to report net profit of Rs 170-180 crore and it is very bad compared to expectations. Asset quality has also worsened and Yes bank shares can witness a bout of correction," Avinash Gorakshakar of Joindre Capital told NDTV.

  4. The bank's net interest income - the difference between interest earned and interest paid - rose 2.78 per cent to Rs 2,280.84 crore in the first quarter of current financial year, from Rs 2,219.14 crore in the year-ago period.

  5. Net interest margin - a key indicator of a bank's profitability - slipped to 2.8 per cent in quarter ended June 30, from 3.3 per cent in the corresponding period a year ago. 

  6. Its gross non-performing assets as a percentage of total advances came in at 5.01 per cent compared with 3.22 per cent in the previous quarter.

  7. Net non-performing assets (NPA) rose to 2.91 per cent in the June quarter, from 1.86 per cent in the previous quarter.

  8. Provisions for loan losses surged to Rs 1,784 crore in the quarter, the bank said in its regulatory filing. 

  9. Yes Bank utilised Rs 1,399.30 crore from a provisioning pool of Rs 2,100 crore it had set aside for non-performing accounts which faced stress due to current market and liquidity conditions, it noted.

  10. Yes Bank shares ended 5.25 per cent lower at Rs 98.45 ahead of its earnings announcement by the company, underperforming the Sensex which finished 0.22 per cent higher.

(With inputs from Reuters)