Public sector lender United Bank of India on Friday reported a net profit of Rs 43.80 crore for the quarter ended September against a net loss of Rs 489.47 crore for the same period a year ago.
The bank posted its third straight quarterly profit after losses in the second and third quarters of the previous financial year. The Q2 net profit was boosted by a 23% y-o-y increase in operating profit to Rs 459.05 crore, coupled with a substantial fall in provisions from the year-ago period.
Total provisions fell 64% y-o-y to Rs 351.84 crore during July-September on the back of a decline in stressed assets. Gross non-performing assets in absolute term decreased to Rs 7,074.69 crore in Q2 from Rs 7,097.44 crore in Q1.
United Bank said despite a slight fall in total income during the second quarter, operating profit grew as the lender was able to lower its expenses. “We have reduced high-cost deposits consistently and are focussing on gaining Casa deposits. So, our cost of deposits declined during the second quarter to 6.9% from 7.42% in the year-ago period,” Sanjay Arya, executive director of United Bank, told FE.
“Also, our bank is consistently bringing down stressed assets. We are among the few banks that have been able to reduce their NPAs despite a challenging economic scenario,” said Arya.