India's IndusInd Bank posts quarterly profit drop as loans decline
The country's fifth largest private lender by assets said its profit fell 68% to 6.84 billion rupees ($78.93 million) for the quarter ended June 30.
IndusInd reported its biggest-ever quarterly loss in the previous quarter, as it took a $230 million hit in the year ended March 31 due to years of misaccounting internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in April.
Since then, the lender has reported a decline in loans.
Loans fell 3.1% from a quarter earlier, while deposits fell 3.3%.
Net interest income, the difference between interest earned and paid, fell to 46.40 billion rupees from 54.08 billion rupees a year earlier.
The private lender has been grappling with elevated bad loans in its microfinance book, forcing it to set aside more funds to meet potential losses.
IndusInd Bank to raise up to $3.5 billion, allow Hindujas to nominate two board seats
Its provisions and contingencies rose 65.5% year-on-year to 17.38 billion rupees.
Gross non-performing assets rose to 3.64% at June-end from 3.13% at March-end.
IndusInd Bank approved raising up to $3.47 billion and allowing promoters to nominate two board directors, it said last week, as it seeks to restore investor confidence.
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Business Recorder
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India's IndusInd Bank posts quarterly profit drop as loans decline
BENGALURU: India's IndusInd Bank reported a quarterly profit drop on Monday, as its loans declined and funds kept aside for potential bad loans rose. The country's fifth largest private lender by assets said its profit fell 68% to 6.84 billion rupees ($78.93 million) for the quarter ended June 30. IndusInd reported its biggest-ever quarterly loss in the previous quarter, as it took a $230 million hit in the year ended March 31 due to years of misaccounting internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in April. Since then, the lender has reported a decline in loans. Loans fell 3.1% from a quarter earlier, while deposits fell 3.3%. Net interest income, the difference between interest earned and paid, fell to 46.40 billion rupees from 54.08 billion rupees a year earlier. The private lender has been grappling with elevated bad loans in its microfinance book, forcing it to set aside more funds to meet potential losses. IndusInd Bank to raise up to $3.5 billion, allow Hindujas to nominate two board seats Its provisions and contingencies rose 65.5% year-on-year to 17.38 billion rupees. Gross non-performing assets rose to 3.64% at June-end from 3.13% at March-end. IndusInd Bank approved raising up to $3.47 billion and allowing promoters to nominate two board directors, it said last week, as it seeks to restore investor confidence.
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India's IndusInd Bank will raise up to $3.47 billion and allow promoters to nominate two board directors, the private sector lender said on Wednesday, as it seeks to restore confidence after a $230 million accounting lapse. IndusInd is looking to secure 300 billion rupees in funding, comprising a 200 billion rupees debt issue on a private placement basis and a 100 billion rupees capital increase through issue or placement of securities. The bank's net worth took a $230 million hit in the fiscal year ended March 31 due to years of misaccounting of internal derivative trades, prompting the resignations of CEO Sumant Kathpalia and deputy Arun Khurana in April. The UK-based Hinduja family own a 15.82% stake in the bank and are listed as its promoters, a regulatory classification in India for large shareholders who control key decision-making. India's IndusInd Bank to consider raising funds The Hindujas can now nominate up to two directors on IndusInd's board, the bank said, adding that the move was approved by India's central bank. Promoters previously did not have representation on the board. IndusInd, currently run by an executive committee, has shortlisted three senior bankers - Rajiv Anand, Rahul Shukla, and Anup Saha - for the position of CEO, Reuters reported last month. Saha resigned as non-bank lender Bajaj Finance's managing director on Monday. IndusInd will report its first-quarter results on July 28.
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