Adar Poonawalla, CEO of the largest covid vaccine maker of country Serum Institute of India, was appointed as chairman of Magma Fincorp on Monday.
It has also appointed Abhay Bhutada as the Managing Director. Veteran banker Vijay Deshwal will take charge as CEO at Magma Fincorp from the first week of July. He is currently a business head at ICICI Bank.
In a statement release, it stated “Magma Fincorp has announced a series of leadership changes following the Poonawala-controlled Rising Sun Holdings acquiring controlling stake through an equity infusion of ₹3,456 crore in May 2021.”
Magma 2.0 have outlined the core strategic pillars of the company which includes the company to run under a new leadership team fully supported by the existing leadership, capitalise benefits from large capital base and stronger parentage, repositioning of the product and geographic focus, early recognition and tackling of asset quality challenges with accelerated write-offs and buffer provisioning, robust ALM profile, and best in class risk management, technology and data analytics.
Meanwhile, for the quarter ended March 31, 2021, Magma Fincorp reported a consolidated net loss of ₹ 647.72 crore as against a net loss of ₹ 35.5 crore in the same period in the previous fiscal.
For 2020-21, its net loss was Rs 558.96 crore versus a net profit of Rs 27.05 crore in 2019-20. Its total revenue was down 4.9 per cent to Rs 587.14 crore in the fourth quarter of 2020-21 as against Rs 617.62 crore in the same period in the previous fiscal.
The company introduced 100 per cent provisions and wrote off all accounts in the 90-plus DPD (Days Past Due) bucket in the SME lending business, 180-plus DPD bucket in the vehicle finance business and 730-plus DPD bucket in the affordable housing finance business.
Apart from one-time incremental write-off impact of Rs.274 crore, it has created management overlay provisions of Rs 621 crore, aggregating to a one-time P&L charge of Rs 895 crore.