The lender had reported a net loss of Rs 4,918 crore in the same quarter last year.
“After a long gap of 13 quarters, we have been able to show net profit of Rs 135 crore in the March quarter. The profit would have been higher but for the recoveries that were affected during March due to the COVID-19 situation,” the bank's managing director and CEO Rakesh Sharma told reporters.
He said recoveries had fallen short of by Rs 700 crore due to the disruptions caused by the coronavirus outbreak.
The recoveries and upgradation in the quarter stood at 1,457 crore and Rs 328 crore, respectively.
The profit in the quarter was also supported by the reversal of Rs 1,500 crore of provisions made for non-performing loans (NPAs).
Net interest income (NII) improved by 46 per cent to Rs 2,356 crore as against Rs 1,609 crore last year same period.
Net interest margin (NIM) improved by 154 basis points to 3.80 per cent for the fourth quarter, 2020 as compared to 2.26 per cent in the year-ago quarter.
For the full year, the bank reported a net loss of Rs 12,887 crore as against Rs 15,116 crore of loss booked in the financial year 2019..
Gross NPA of the bank stood at 27.53 per cent as against 27.47 per cent
Net NPA improved to 4.19 per cent from 10.11 per cent.
Fresh slippage in the quarter stood at Rs 727 crore. Provision coverage ratio (PCR) stood at 93.74 per cent.
The lender, which is under RBI's prompt corrective action (PCA) since May 2017, expects to come out of it soon.
Sharma said the bank has extended the Reserve Bank of India's moratorium on term loans repayments to all its borrowers In value terms, 66 per cent of retail borrowers and 97 per cent of MSME and agriculture borrowers have availed the moratorium.
It had set aside Rs 247 crore for COVID 19 related provisions as mandated by the RBI.
The lender said it can offer up to Rs 1,700-1,800 crore in loans to medium, small and micro enterprises (MSMEs) under the Rs 3 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) announced by the government.
The bank expects to complete stake sale IDBI Federal Bank by September this year, Sharma said.