Money & Banking

UCO Bank loss narrows to ₹601 crore in Q1

Our Bureau New Delhi | Updated on August 08, 2019 Published on August 08, 2019

Bank sets target to recover ₹2,000 cr every quarter: CEO

Higher provisions have resulted in UCO Bank posting a net loss of nearly ₹601 crore in the quarter ended June 30, 2019.

This was marginally down from the net loss of about ₹634 crore posted in the corresponding quarter last year.

Total provisions (other than current tax) and contingencies stood at ₹1,803 crore in Q1 of FY20, against ₹1,781 crore in the same period last year. The operating profit of the bank improved by a marginal 2 per cent to ₹1,201 crore during the quarter under review, which was the highest in the last 14 quarters, AK Goel, MD and CEO, UCO Bank, told newspersons here on Thursday.

Ageing provisions for non-performing assets (NPAs) led to high net loss in the last quarter, he said.

Provision coverage ratio increased to 77.12 per cent as on June 30, 2019, against 65.15 per cent in the same period last year.

Net interest income increased by 9 per cent to ₹1,335 crore (₹1,228 crore).

The percentage of gross NPA to advances stood at 24.85 per cent (25 per cent), while net NPA reduced to 8.98 per cent (12.74 per cent) during the period under review.

UCO Bank has set a target of recovering ₹2,000 crore every quarter. It will also lay emphasis on arresting slippages.

During the April-June quarter, the bank witnessed fresh slippages of ₹1,233 crore, lower than the ₹1,928 crore it registered in the same period last year. The total recovery during Q1 FY20 was close to ₹824 crore.

The bank had raised ₹500 crore as Tier II capital from LIC in the last quarter. This apart, it has raised ₹266 crore through Employee Stock Purchase Scheme (ESPS).

The total capital required by the bank during the current financial year is estimated at ₹4,500 crore, he said.

The bank is exploring the possibility of approaching the government for seeking capital support. This apart, it will explore all options for raising capital, including LIC, ESPS, and qualified institutional placement (QIP), he added.

Interest rate cut

When asked about the possibility of an interest rate cut, he said the bank’s ALCO has recently decided to reduce the MCLR by 5 basis points to 8.60 per cent in the one-year time bucket.

The bank’s scrip closed at ₹16.20, up 0.62 per cent on the BSE on Thursday.

 

Published on August 08, 2019
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