Suryoday SFB Q4 results: Net loss widens to Rs 43 crore on sharp fall in interest income

KOLKATA: Suryoday Small Finance Bank‘s net loss widened to Rs 43 crore in the March quarter compared to the year ago period’s Rs 15.5 crore due to sharp fall in interest income.

“The elephant in the room is the impact of the second wave,” Suryoday managing director R Baskar Babu said, after the first ever post-listing quarterly result announcement. He refrained himself from giving guidance on business growth as the impact of the second wave is not fully comprehended by most businesses.

The bank has reported Rs 5 crore operating loss against Rs 70 crore profit in the year ago period while total income shrunk to Rs 186 crore against Rs 228 crore. Net interest income fell 25 per cent at Rs 152 crore over the same period, largely impacted by interest reversal of Rs 66 crore in the quarter on account of NPA recognition, which was earlier stalled by the Supreme Court.

Babu however expressed hopes saying that nothing has substantially deteriorated other than the fall in repayment collection. “There are no big capital losses (for our borrowers) and therefore businesses would be back to normalcy faster once the restrictions are removed.”

Suryoday’s asset quality for the March quarter deteriorated with gross non-performing assets ratio rising to 9.4 per cent, which was 13 basis points higher than the pro-forma ratio three months back. It wrote off loans worth Rs 36 crore in the quarter under review.

The bank however made 44 per cent lower provisions at Rs 53 crore during the quarter despite the higher stress in asset quality. This includes additional floating provision of Rs 37.5 crore, which is 1.5 per cent on standard micro finance portfolio. Microfinance accounts for nearly 70 per cent of its gross loan outstanding of Rs 4200 crore.

“We believe it’s a matter of time that repayment would fall in line. There could be delays but no major credit losses. About 75 per cent of our borrowers including those in the delinquent category are repaying loans,” he said.

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