InvestorQ : I am holding shares of Corporation Bank and was surprised by the huge loss posted by the bank. Should I hold on to the stock or sell off?
Arya Nanda made post

I am holding shares of Corporation Bank and was surprised by the huge loss posted by the bank. Should I hold on to the stock or sell off?

Answer
user profile image
Deepa Salunkhe answered.
1 year ago


For the fourth quarter, Corporation Bank posted a loss of Rs.6581 crore as it saw doubling of its loss provisions in the quarter. Even total revenues fell by over 10% to Rs.4187 crore meaning the loss was nearly 50% more than the total revenues, which is not very comforting. This is nearly 3.5 times the loss reported by the bank in the corresponding quarter last year. The bank has a strong SME portfolio and its gross NPAs are still quite high at 15.35% although it has come down.

At Rs.26, the stock may look cheap but it is hard to take a call till there is full clarity on when the NPA cycle will bottom out. If you want to buy PSU banks as well stick to the leaders like BOB and SBI where the risk is much lower and the potential for a turnaround much brighter.