REUTERS - Axis Bank Ltd, India’s third-biggest private sector lender by assets, said on Tuesday second-quarter net profit jumped by about 36 percent, as provisions for bad loans eased from a year earlier.
Net profit rose to 4.32 billion rupees ($66.6 million) for the quarter ended Sept. 30. Provisions and contingencies fell about 13 percent to 31.40 billion rupees.
Gross bad loans as a percentage of total loans stood at 5.90 percent in the quarter, compared with 5.03 percent a quarter earlier and 4.17 percent a year earlier
Outstanding loans on the bank’s watch list, or potential troubled loans, fell 24 percent from the previous quarter to 60.52 billion rupees as of end-September.
Net interest income for the quarter grew 1 percent from a year earlier, while fee income grew 12 percent. Its net interest margin was 3.45 percent, compared with 3.63 percent a quarter earlier.
After pushing 12 of the country’s biggest loan defaulters to bankruptcy proceedings earlier this year, the Reserve Bank of India (RBI) has directed banks to take 28 more companies to bankruptcy court if other forms of debt resolution do not work out by mid-December.
Axis Bank said as of the end of June it had outstanding loans of 18.43 billion rupees to 12 companies in the latest central bank list, and a non-fund exposure of 6.49 billion rupees. It added that three-quarters of the outstanding loans were secured. ($1 = 64.9000 Indian rupees)
Reporting by Samantha Kareen Nair in Bengaluru; editing by Jason Neely and Keith Weir