CUB posts 5 pct growth in net profit

Written by fe Bureau | Chennai | Updated: Feb 7 2014, 16:07pm hrs
City Union Bank (CUB) has reported a 5% growth in its net profit for the quarter ended December 31, 2013, at Rs 89 crore compared to Rs 85 crore recorded in the same quarter last fiscal, on a 14% growth in total income to R711 crore.

The net profit was impacted due to an 18% increase in total expenses, which include higher tax provisions, sharp rise in operational as well interest expenses during the quarter, said N Kamakodi, MD and CEO of the bank.

While announcing Q3 results on Thursday, he said net interest income grew 21% to R197.54 crore (R163.43 crore) and the net interest margin (NIM) was better at 3.62%. During the quarter, both the gross and net NPA level increased to 1.70% and 0.89%, respectively, against 1.23% and 0.63% during the same quarter last fiscal, Kamakodi said.

During the quarter, total business also grew marginally at 3%, he further added.

In rupee terms, the gross NPA went up to R179 crore from R269 crore in the same quarter last fiscal and the net NPA level rose to R139 crore (R91.43 crore).

To a question, he said the bank hopes to retain NPA levels that of Q3 in the last quarter too, and would end up with a modest recovery to arrest them. We will look at selling some of the NPAs to Arcil in the future and we will identify those NPAs going forward. But as of now, we have no plans to sell NPAs, Kamakodi pointed out.

The capital adequacy ratio (CAR) has been pegged at 13.61% during the quarter and the CD ratio was over 75%.