Karnataka Bank tanks on earnings

about 8 months ago
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Karnataka Bank posted good numbers for Q4FY19. The Bank posted a 461% (YoY) jump in net profit at Rs.62 crore though it is lower than the profit of Rs.140 crore posted in Q3FY19. What really helped boost the YoY net profit was the lowering of provisioning – for Q4FY19 it was at Rs.218 crore v/s Rs.542 crore (YoY) though a tad more than Q3 provisioning of Rs.209 crore. It was provisioning which had pushed PBT into red in previous Q4 and this Q4, it is the reason for the higher bottomline.

In terms of asset quality, Gross NPA was down from 4.45% to 4.41% (QoQ) and Net NPA was down from 3% to 2.95%.

The provision coverage ratio as at 31st March 2019 stood at 58.45% .(54.56% as on March 31, 2018).

The Capital Adequacy of the Bank under Basel III now improved to 13.17%  against 9% minimum as stipulated by RBI as against 12.04% as of 31-03-2018.

The market, following the overall trend, has decided to book profits on this counter post the numbers. The stock price slipped 7.5% to Rs.109.40  and continues to remain in the red.

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