Indian Bank weakens after Q3 net drops 85%

Shares of Indian Bank were down over 3% at Rs 77.50 on the BSE after the state-owned bank registered a 85% drop in its net profit at Rs 42.30 crore in the third quarter ended December 2015 compared to Rs 277.52 crore during the same quarter last year because of higher provisioning towards bad assets.

However, total income of the bank for the quarter was marginally higher at Rs 4,438.40 crore as compared to Rs 4,321.46 crore.

Mahesh Kumar Jain, managing director & CEO, Indian Bank, told reporters that higher provisioning has taken a toll on the bottom line of the bank.

"We have provisioned close to Rs 200 crore more this quarter than second quarter and this coupled with fresh slippage to the tune of Rs 1,738 crore to bad assets, had resulted in drop in net profit. The bank had provisioned Rs 718.05 crore in third quarter, towards sticky assets," he said.

The stock opened at Rs 80.70 and touched a low of Rs 76.75. At 10:35am, over 49,000 shares were traded on both the stock exchanges.