Finmin displeased at poor profit numbers of state-run banks
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Finmin displeased at poor profit numbers of state-run banks

Last Updated: Sunday, May 26, 2013, 14:28
 
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Finmin displeased at poor profit numbers of state-run banks
Mumbai: The Finance Ministry has made public its displeasure over the dip in the bottomlines of most of the state-run lenders, including State Bank of India, in the March quarter earnings.

"It is akin to asking someone who got bashed up on the road how he feels about it," Financial Services Secretary Rajiv Takru said on the sidelines of an event here over the weekend when asked for his response to the drop in net profit of many public sector banks in the March quarter.

"I am not in love with it, no!" he added.

Driven by a higher provisioning, SBI's net for the March quarter plunged 18.5 percent at Rs 3,299.22 crore against Rs 4,050.27 crore in year-ago period.

This was the first time in the last two years that the bank had shown a decline in the quarterly net profit.
SBI, which was among the last banks to come out with its numbers, joined a slew of its peers from the state-run lenders space in declaring lower numbers.

Among other banks, net profit of Kolkata-headquartered Allahabad Bank plummeted to Rs 126.15 crore against Rs 400.22 crore in the corresponding period a year ago.

Others in the league are United Bank of India (Rs 31.18 crore in March 2013 against Rs 149.29 crore year ago), Indian Overseas Bank (Rs 58.86 crore versus Rs 528.81 crore), Bank of India (Rs 756.57 crore versus Rs 952.73 crore) and Bank of Baroda (Rs 1,028.85 crore against Rs 1,518 crore).

However, Union Bank of India and Corporation Bank managed to show a marginal rise in profits during the period.

Takru also reiterated his demand for hiking the penalty for errant banks found flouting rules from the current Rs 1 crore.

"Rs 1 crore is insignificant in current context. It has been discussed with the RBI. It requires a change in the rules. As soon as that limit is increased, one can look at heavier fines," he said.


PTI




First Published: Sunday, May 26, 2013, 14:28


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