The housing finance arm - SBI Home Finance - of the country's largest lender, SBI has incurred a net loss of Rs 5.37 crore for the third quarter ending on December 31st as compared to a net loss of Rs 5.12 crore recorded for the same quarter in the last fiscal.
In a filing with Bombay Stock Exchange the firm informed that, "the company has stopped all its operations and is not a concern."
The hosing regulator, National Housing Bank (NHB) has also accepted the order of forbidding SBI Home Finance from continuing with its operations. The regulator has approved the order after reviewing the firm's losses for the past several years.
The filing stated that since the firm was incurring losses, no provisions for tax except Fringe Benefit Tax has been allowed.
For the period under review, the firm recorded a total income of Rs 7.23 lakh and a net income of Rs 32.75 lakh for the same period a year ago. The income clocked by the firm is attributed to the interest earned on fixed deposits parked with various banks.
Moreover SBI has sent a notice to SBI Home Finance claiming for payments on the entire loan dues.
Earlier in 2005, NHB had also cancelled the license of ailing SBI Home Finance.