The Hindu Business Line : City Union Bank Q3 net rises 83%

Chennai, Jan. 31 A 25 per cent increase in net interest income and a doubling of ‘other income’ helped City Union Bank post a net profit of Rs 25.38 crore for the third quarter of the current year, 83 per cent higher than in the corresponding quarter last year.

‘Other income’ was aided by commission income from selling Life Insurance Corporation’s products. In the nine months up to December, City Union Bank collected Rs 17 crore of first premium, compared with Rs 15 crore for the whole of last year. (Forty per cent of the first premium collected is the commission.)

At a press conference here on Thursday, the bank’s Chairman, Mr S. Balasubramanian, said that having the two marquee investors — L&T and LIC — has helped business.

The relationship with LIC is to be strengthened — apart from selling insurance products, talks are on for putting at least 30 branches (initially) of the bank on the job of collecting premium. As regards L&T, the bank sees good potential to provide credit and services to L&T’s business associates such as equipment suppliers, contractors and sub contractors. CUB also intends to offer cash management services to L&T.

investment book

The City Union Bank’s Executive Director, Mr N. Kamakodi, said that the bank would build up its investment book over the coming months. At present, the book stands at Rs 1,796 crore, of which around Rs 300 crore is ‘available for sale’.

The bank expects to end the year with a portfolio of close to Rs 2,000 crore and further build it up to Rs 3,000 crore next year.

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