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The stock of Axis Bank fell a sharp 10 per cent, after the bank reported a steep rise in quarterly slippages in the September quarter. From ₹3,519 crore in June 2017, slippages shot up to ₹8,936 crore in the September 2017 quarter, owing to bad loan divergence reported for FY-17. Axis Bank had reported sharp divergences from asset classification and provisioning of the RBI norms last year too — ₹9,478 crore pertaining to FY-16.
The bank’s core performance has also been subdued over the past year.
The bank saw a muted 1 per cent y-o-y growth in core net interest income. This is mainly on account of reversal of interest income owing to a rise in bad loans. In September last year, loan-loss provisions had grown five-fold.
On such a high base, relatively lower provisions in the latest September quarter have led to 36 per cent y-o-y growth in net profit.
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