Indian Bank drops capital raising plan on lower ECL hit

Indian Bank has shelved its Rs 2,500 crore qualified institutional placement (QIP) plan after a revised estimate pegged the expected credit loss (ECL) impact lower at Rs 3,000-3,500 crore, against an earlier estimate of Rs 4,000-6,000 crore. The bank has already built a Rs 1,000 crore floating provision and plans to add another Rs 1,000 crore, making fresh capital raising unnecessary with capital adequacy ratio at a comfortable 17.58 percent. Q1 net profit rose 10 percent year-on-year to Rs 3,273 crore, net interest income jumped 17 percent to Rs 7,435 crore, NIM improved to 3.29 percent, and gross NPAs fell sharply to 1.86 percent from 3.01 percent a year earlier.