LVB said that the bank continues to enforce cost reduction measures both of direct and indirect costs.LVB said that the bank continues to enforce cost reduction measures both of direct and indirect costs.

Cash-starved Lakshmi Vilas Bank (LVB) on Saturday said that despite logistical challenges arising due to the Covid-19 situation, the bank has made significant progress with Clix group for the proposed amalgamation of Clix Capital Service and Clix Finance India into the bank.

There was minor incremental due diligence requested by Clix Group, which was completed this week, and the respective sides are in the process of finding a workable and mutually acceptable framework, LVB said in a disclosure to the stock exchanges after a board meeting to approve the second quarter results.

Sources said the board did not take up the Clix issue at the meeting, as the two-member panel, mandated to hold negotiations on the merger modalities, had informed that the process was still on and will take some more time to reach a deal.

The board had approved the issue by equity shares up to Rs 500 crore by way of rights issue and ICICI Securities has been appointed as the merchant banker for the issue. LVB said that the bank continues to enforce cost reduction measures both of direct and indirect costs. The bank focuses on capital-free loans like gold loans, government-guaranteed loans to optimise profitability without straining capital funds. LVB on Saturday reported a net loss of Rs 396.99 crore for Q2 against net loss of Rs 357.18 crore in the corresponding quarter last fiscal.

The gross NPA stood at 24.45% as against 21.25%, while net NPA stood at 7.01% as against 10.47%. The provision coverage ratio stood at 79.66%, while the bank’s total capital adequacy ratio (CAR), as per Basel Ill guidelines, was at (2.85)%, it said. Net interest margin (NIM) of the bank stood at 1.37% as against 1.47%. The total business of the bank was at Rs 37,595 crore as against Rs 47,115 crore.

The CASA as a percentage to total deposits stood at 28.94% as against 25%.

Praveen Kumar Molri has been co-opted as additional director of the bank in the category of non-executive and independent director at the board meeting.

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