Dena Bank

Dena Bank posted a set of extremely disappointing numbers – both on profitability as well as asset quality front. It reported a net loss of Rs.575 crore in Q4FY17, much higher than the loss of Rs.326 crore recorded in previous Q4.

In terms of asset quality too, the deterioration is steep. Gross NPA rose sharply from 14.79% to 16.27% (QoQ) while Net NPA increased from 9.52% to 10.66%.

Provisions have burgeoned from Rs.484 crore to Rs.972 crore (QoQ) and up from Rs.900 crore in previous Q4. The slippages during the quarter stood at Rs.2321 crore, up very sharply from Rs.930 crore in Q3. In an TV interview, the Bank’s CEO said that the biggest slippage was from Videocon at Rs.520 core, followed by Ruchi Soya at Rs.125 crore, Monnet Ispat at Rs.310 crore, JP Associates at Rs.90 crore and Amtek Auto at Rs.65 crore. As one can see, all are troubled companies and the Bank is bearing the brunt of some poor management decisions. The worrying aspect is that the asset quality pain is not yet over and is likely to continue for some more months; in fact Q1 itself could see slippages to the tune of Rs.300 crore.