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Our Bureau

Business crosses Rs 1-lakh cr; `CAR quite comfortable'

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Kolkata Jan. 29 UCO Bank has posted a net profit of Rs 122.95 crore in the third quarter of the current fiscal, marginally up from Rs 112.51 crore in the corresponding quarter of the previous year.

The bank's total income for the quarter stood at Rs 1,479.14 crore compared with Rs 1,241.32 crore at the end of the third quarter ended December 2005. This represents an increase of 19.16 per cent.

Its interest income increased by 17.78 per cent from Rs 1,137 crore to Rs 1,339.17 crore. Net profit for the nine-month period ended December 31, 2006 was Rs 285.16 crore, up from Rs 255.39 crore recorded at the end of the corresponding period of last year. UCO Bank's business as on December 31, 2006, has crossed Rs 1 lakh crore, said Mr Sridhar, Chairman-cum-Managing Director.

The bank has set a target of Rs 1.11 lakh crore for the full year, he added.

At the end of December 2006, its capital adequacy ratio stood at 12.65 per cent. This, the bank feels, is quite "comfortable" at the moment, at least till 2008. However, restructuring talks with the Government are on.

Its deposit growth, although low, is said to have been sufficient at the moment, especially with the bank's access to refinance agencies. Refinance has accounted for Rs 1,600 crore in the first nine months of the fiscal. This year, the cost of deposit has been somewhat cheaper, it is pointed out.

The bank has set NPA targets - 2.58 per cent gross and 1.59 per cent net - for the year. It had recently received permission to open a representative office in Guangzhou in China from China's banking regulator. The office is expected to be opened by March.

Talks on for life insurance foray

UCO Bank is in preliminary talks with possible partners for investing in a life insurance venture.

The bank, aware that a number of its public-sector peers have made forays into insurance in association with others, will shortly take up the issue for discussion.

"We are exploring the idea. We will have to see how we may do this without constraining ourselves," Mr Sridhar told newspersons.

He was not willing to divulge details (including the names of possible joint venture associates) at this juncture.

Quite a few PSU banks have shown interest in the insurance business, both life and general in recent times. One of UCO Bank's local peers, Allahabad Bank, has formed a venture with Sompo of Japan and other partners.

More Stories on : Life Insurance | Public Sector Banks

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