SKS Microfinance has reported a 38.4 per cent fall in net profit to Rs 34.15 crore for the quarter ending December 31, 2010, as compared with the Rs 55.45 Crore net profit that it had reported for the corresponding period in 2009. The revenues of SKS Microfinance during the quarter increased by 44.5 per cent to Rs 384.68 crore from Rs 266.21 crore reported in 2009.
The decrease in profit is a result of a 10-fold increase in provisioning and writing off of bad loans arising in the state of Andhra Pradesh. According to a statement issued by the company’s spokesperson on Monday evening to the press, the amount provisioned included an additional Rs 26.98 Crore to meet the recommendations of the Malegam committee.
The Malegam Committee had stated than an MFI will have to at all times, maintain an aggregate provision for loan losses, which shall be either 1 percent of the outstanding loan portfolio, or 50 percent of the aggregate loan installments overdue between 90 days and 180 days, or 100 percent of the such instalments due for over 180 days, whichever is higher.
The share prices of SKS on the National Stock Exchange (BSE) lost more than 3 percent and closed at Rs 661 on Tuesday. For the three months ending 31st December, SKS’s share price has dropped by more than 50 percent while the Sensex has gained 2.19 percent.
The detailed breakup of SKS Microfinance Results are given below
|Result Period||01-October 2010 to 31-December-2010 (Third Quarter)|
|Result Type||Unaudited, Non-Cumulative, Non-Consolidated|
SKS Microfinance – Q3 Numbers