New Delhi: Allahabad Bank, which posted a loss of Rs 8,334 crore last fiscal, hopes to return in the black going forward on the back of tight recovery mechanism and arrest of fresh slippages, according to its annual report 2018-19. The Kolkata-based lender registered a loss of Rs 4,674 crore in 2017-18 and a loss of Rs 279 crore during 2016-17.

"Dedicated verticals are in place to ensure recovery of around Rs 2,000 crore per quarter. We expect the bank to break even during Q1FY'20 and thereafter to post net profits consistently.

"The net interest margin is expected to be around 2.65 per cent and visible improvement in cost to income ratio," MD and CEO SS Mallikarjuna Rao said in his address to shareholders.

In January last year, the lender came under RBI's watch-list under the Prompt Corrective Action (PCA) framework due to losses on its books.

However, with capital infusion of Rs 11,740 crore in three tranches during 2018-19, the RBI lifted the restrictions imposed on the lender from February 2019.

The bank is also pursuing reforms agenda –Enhanced Access and Service Excellence — prescribed by the finance ministry for turnaround of the bank, the report said.

"FY'19 was a challenging year for the Indian banking industry due to continued stress faced in asset quality on account of various macroeconomic and other factors.

"The bank is looking at a modest business growth of 9 per cent during 2019-20 through focus on consolidating current account savings account (CASA) base and increasing dependency under retail sector," it said.

The lender expects slippages to moderate and be contained at around 1 per cent per quarter.

The concept of Stressed Asset Management Vertical (SAMV) has been introduced for effective and timely monitoring of NPA accounts and follow up of due process in such accounts, the bank said.

About fund raising plans, the bank said it will be augmenting growth capital during 2019-2Read More – Source