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City Union Bank reported a marginal increase in net profit for the fourth quarter ended March 31, 2014, at ₹83.34 crore, against ₹82.49 crore in the comparable previous year quarter. The drop in growth was attributed to provisioning towards stressed assets. The total income of the bank moved up to ₹726.26 crore for the quarter from ₹677.99 crore, registering over 7 per cent growth.
Announcing the fourth quarter results at a press conference here on Monday, N Kamakodi, Managing Director and CEO of the bank, said during the fourth quarter, the bank had to provide a sum of ₹31 crore for NPAs (non-performing assets).
“The difficult economic situation has had slight impact on our asset quality. The bank’s gross NPA at the end of the 2013-14 stood at 1.81 per cent, moving up from 1.7 per cent registered in the previous fiscal, while the net NPA level was at 1.23 per cent, up from 1.13 per cent. The provision-coverage stood at 62 per cent. However, compared to the industry benchmark, the rise is not really alarming,” he said.
There were three-four accounts above ₹50 crore from the power and steel segments which turned bad. For the whole year, the bank had to provide ₹148.5 crore for NPAs as against ₹97 crore in the previous fiscal.
Kamakodi said total advances of the bank rose 6 per cent to ₹16,224 crore as on March 31, 2014, from ₹15,343 crore in the previous year. Total deposits increased by 8 per cent to ₹22,017 crore from ₹20,305 crore. CASA (current and savings account) deposits rose 15 per cent to ₹3,917 crore from ₹3,405 crore.
The bank’s capital adequacy ratio (CRAR) is well above the minimum levels prescribed by the RBI. As on March 31, 2014, the total CRAR of the bank stood at 15.11 per cent, of which, tier-I CRAR was healthier at 14.48 per cent.
Kamakodi said the bank already has shareholders’ approval to raise ₹350 crore through QIP (qualified institutional placement) or preferential allotment of shares. “We will go to the market as and when we require funds, provided there exists a favourable sentiment in the marketplace,” he added.
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