Federal Bank plunges 10% on weak Q4 results

Federal Bank has plunged 10% to Rs 90.65 on the market in early morning trade, after the private sector lender reported weak set of numbers with assets quality worsens in March 2018 quarter (Q4FY18). The stock was trading close to its 52-week low of Rs 87.50 touched on February 6, 2018 on the BSE in intra-day trade.
The bank’s net profit during the quarter under review fell by 43.5% to Rs 1.44 billion on higher provisioning for bad loans. It had posted a net profit of Rs 2.56 billion for quarter ended March 2017 (Q4FY17).

Bank has made accelerated recognition of sensitive assets and treated them as non-performing loans (NPAs) and made provisions for it. The provisioning for bad loans and contingencies grew three times in Q4FY18 to Rs 3.71 billion from Rs 1.22 billion in Q4FY17.

Bank's gross NPAs rose to 3% of the gross loans (Rs 27.95 billion) as on March 31, 2018 compared with 2.33% (Rs 17.27 billion) at end-March 2017. Net NPAs were at 1.69% (Rs 15.51 billion) as against 1.28% (Rs 9.41 billion).