Bandhan Bank share Q4 results

Bandhan Bank Q4 Results: Profit Plunges, Stock Slips, and Loan Write-Offs Cause Drop

Bandhan Bank faces a drastic 94% drop in net profit during Q4, causing a 7% slip in stock prices and significant loan write-offs.

Bandhan Bank recently released its Q4 results, revealing a staggering 94% plunge in net profit to ₹54 crore compared to the previous year. The sharp decline was mainly attributed to higher provisions, with the bank reporting a substantial amount of Rs 1774 crore as compared to Rs 735 crore in the previous year's Q4. This unexpected downturn caused Bandhan Bank stock to slip by 7% on heavy trading volumes as investors reacted to the disappointing financial figures.

During the quarter, the bank took a prudent measure by writing off loans amounting to Rs 3852 crore, impacting the Q4 net profit, which plummeted further to Rs 55 crore. This decision to write off loans, although necessary, contributed to the overall decline in the bank's financial performance. The situation was exacerbated by the lender declaring a significantly lower net profit of ₹54.6 crore, far below the predicted ₹882.3 crore, as indicated by a CNBC-TV18 poll.

In light of these results, Bandhan Bank struggled with a 5% decline ahead of the Q4 results, signaling a halt to its previous five-day winning streak in the trading session. The Indian private lender found itself in a challenging position, grappling with increased provisions and write-offs that led to a 93% drop in fourth-quarter net profit, reflecting the tough decisions made by the bank to maintain financial stability amidst economic uncertainties. These results highlighted the importance of prudent financial management and risk assessment in the banking sector, urging investors to closely monitor the performance and strategies of financial institutions for sound investment decisions.