Xinja Bank’s trading losses continue to run deep.
The bank’s APS330 or ‘pillar 3’ report for the September 2020 quarter suggests its losses over the quarter burned through most or all of the A$10 million capital raised in September.
Risk weighted assets for Xinja at the end of September 2020 were $72.6 million, essentially unchanged from June.
The Common Equity Tier 1 Ratio and Total Capital Ratio were unchanged at 25 per cent across the quarter.
This means the capital base of the company was unchanged between June and September. Thus the new capital scraped together by the Lindley Edwards-led Xinja Bank board no more than covered the quarterly burn rate.
Retained losses in the annual report for June 2020 were $64.2 million.
Xinja’s auditor, PwC raised a material uncertainty related to going concern.
“The Group is highly dependent on raising additional capital to fund its continuing development activities while maintaining sufficient levels of capital above the minimum prudential capital requirements.
“These conditions, along with other matters, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern.”