(Reuters) - India’s Yes Bank Ltd missed second-quarter profit estimates by a wide berth on Thursday as provisions for bad loans and mark-to-market losses more than doubled, exacerbating woes at the bank in search of a new CEO.
Net profit came in at 9.65 billion rupees ($132 million) in the quarter ended Sept. 30, compared with 10.03 billion rupees a year earlier and short of analysts’ average estimate of 12.82 billion rupees, according to I/B/E/S data from Refinitiv.
Provisions, or the amount set aside to cover a future liability, surged 110 percent to 9.40 billion rupees.
The results come as Yes Bank looks for a new chief executive by the Feb. 1 deadline imposed by India’s central bank, which last month denied CEO Rana Kapoor an extension of his term with the firm he founded.
The Reserve Bank of India (RBI) did not give a reason for the decision, which sent Yes Bank shares plummeting. Market participants said the move represented the central bank’s new hard-line approach in reducing the bad debt plaguing India’s banking sector.
Yes Bank’s gross bad loans as a percentage of its total loans stood at 1.60 percent by the end of September, compared with 1.31 percent a quarter earlier and 1.82 percent a year earlier.
Yes Bank shares closed 2.8 percent lower ahead of the results.
($1 = 73.2300 Indian rupees)
Reporting by Chris Thomas in Bengaluru; Editing by Christopher Cushing and Susan Fenton