Indian Overseas Bank · Material risks, their source context, and severity in the latest available quarter.
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Risk intelligence
SMA2 rose from ₹3,646 crore (March 2026) to ₹4,246 crore despite total SMA declining. Management attributes this to normalization and points to 0.06% slippage ratio as evidence of asset quality soundness, but analyst raised concern about government-guaranteed accounts within this bucket.
PSLC commission of ₹863 crore contributed materially to profitability. Management claims these are recurring across last 8-9 quarters, but analyst explicitly questioned sustainability given one-time nature of some components. Recovery from technically written-off accounts (₹490 crore) also flagged as variable.
₹5,000 crore QIP planned for Q3/Q4 will dilute GOI's 96.44% stake significantly. Timing dependent on market conditions; multiple tranches planned. No clarity on exact dilution percentage or pricing methodology.
Total ECL requirement assessed at ₹3,000 crore; only ₹2,150 crore provided so far. Management committed to not using 4-year dispensation and completing provisioning this financial year, which may pressure future quarters' earnings.
