Union Bank of India net up 32.4% at R104 crore

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Mumbai | Published: February 9, 2017 3:18:16 AM

State-owned Union Bank of India on Wednesday reported a 32.4% year-on-year (y-o-y) rise in net profit at R104 crore for the December quarter, owing to a 50% y-o-y jump in other income to R1,339.67 crore.

The bank's domestic net interest margin (NIM) stood at 2.04% for Q3FY17 as against 2.31% for the same quarter last year.The bank?s domestic net interest margin (NIM) stood at 2.04% for Q3FY17 as against 2.31% for the same quarter last year.

State-owned Union Bank of India on Wednesday reported a 32.4% year-on-year (y-o-y) rise in net profit at R104 crore for the December quarter, owing to a 50% y-o-y jump in other income to R1,339.67 crore.

The bank reported a total income of R9,589.45 crore, up 8.8% y-o-y, of which interest income was R8,249.78 crore. Net interest income, which is the difference between interest earned and interest expended, came in at R2,136.62 crore, up by over 6.9% y-o-y. The bank’s domestic net interest margin (NIM) stood at 2.04% for Q3FY17 as against 2.31% for the same quarter last year.

In terms of asset quality, Union Bank witnessed a deterioration in the quarter under review, both sequentially and on y-o-y basis. Gross non-performing assets (GNPA) constituted 11.70% of the total advances, as much as 465 basis points (bps) more than in the corresponding quarter a year ago and 97 bps more than the sequential quarter. In absolute terms, GNPAs stood at R32,403 crore while net NPA stood at R18,246 in Q3FY17. The bank’s total slippages during the quarter stood at R3,294 crore, down 3% from the sequential quarter.

The lender’s current and savings account (CASA) share in total deposits improved to 36.8% in Q3FY17 compared to 30.6% in the same quarter last year.

The public sector lender’s provisions for the quarter stood at R1,747 crore, was around 39.09% higher than its provisions in the same quarter last year. Moreover, the portion of provisions meant for NPAs increased by over 27.2% over the same period to R1,582 crore.

The bank’s deposits surged during the Q3FY17, primarily due to the government’s decision to withdraw currency notes of R500 and R1,000 in November, which pushed people to deposit most of their cash in bank accounts. When compared to the same quarter last year, the total deposit base was higher by 16% at R3.79 lakh crore.

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