Union Bank of India (UBI) soared 255 per cent year-on-year (yoy) in the first quarter standalone net profit at ₹1,181 crore on the back of robust growth in other income.

The Bank had reported a net profit of ₹333 crore in the year ago quarter.

In the first quarter ended June 30, 2021, net interest income (NII) was up about 9.50 per cent yoy to ₹7,013 crore (₹6,403 crore in the year ago quarter). 

Other income, comprising income from activities such as commission, fees, earnings from foreign exchange and derivative transactions, profit and loss from sale of investment and recoveries from written off accounts, jumped 98 per cent yoy to  ₹2,901 crore (₹1,462 crore). 

Slippages in the reporting quarter were higher at  ₹7,049 crore (₹1,750 crore in the year ago quarter). MSMEs accounted for 45 per cent of the total slippages, followed by ”large corporate & others” and agriculture (about 20 per cent) and retail loans account (15 per cent).  

Loan loss provisions nudged up a tad to ₹2,492 crore (₹2,451 crore). Standard assets provisions soared 167 per cent to ₹1,096 crore (₹410 crore).

Rajkiran Rai G, MD & CEO, said the Bank expects reduction in gross non-performing assets (NPAs) through recovery & upgradation at ₹13,000 crore, including ₹5,600 crore via the National Company Law Tribunal route, in FY22. In the reporting quarter, the recovery & upgradation was at ₹4,341 crore.

The Bank identified 17 accounts aggregating about ₹7,700 crore so far to transfer to the National Asset Reconstruction Company Ltd.

Gross NPAs declined to 13.60 per cent of gross advances as at June-end 2021 against 14.95 per cent as at June-end 2020.

Net NPA position, however, improved to 4.69 per cent of net advances as at June-end 2021 against 4.97 per cent as at June-end 2020.

Total deposits increased by 1.79 per cent yoy to ₹9,08,528 crore, with low-cost current account, savings account (CASA) deposits proportion in domestic deposits rising to 36.39 per cent from 33.30 per cent as on June-end 2020. 

Gross advances declined 0.77 per cent yoy to ₹6,45,091 crore. Within this, domestic advances edged up 0.16 per cent yoy to ₹6,30,237 crore and overseas advances declining 29 per cent yoy to ₹14,854 crore.

Global net interest margin rose to 3.08 per cent from 2.78 per cent in the year ago quarter.

 

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