Private sector City Union Bank on Wednesday reported a 22% jump in its net profit to Rs 154.80 crore on the back of strong net interest income. The Tamil Nadu-based bank had recorded a net profit of Rs 126.62 crore in the corresponding quarter last fiscal. Speaking to reporters after releasing the bank’s earnings performance, MD & CEO N Kamakodi said, “Our robust growth in advances over the last three quarters and growing interest income enabled our net profit grow by 22% supplemented by an equally strong 19% growth in net interest income.” The net interest income grew by 19% at Rs 365.14 crore as against Rs 306.98 crore while interest income rose by 7% at Rs 865.36 crore as compared to Rs 811 crore. The total income of the bank has increased by 3% to Rs 987.05 crore from Rs 953.81 crore. He said the bank has registered satisfactory performance during the third quarter and has been able to contain NPA levels. The gross and net NPA levels stood at 3.3% (2.98%) and 1.74% (1.72%) respectively as of December 31, 2017.
The provision coverage ratio as of December 31, 2017 stood at 65%. He said that the bank is expecting an 18 % growth in credit during the current financial year. It has no plans to raise funds at present, as the bank is adequately capitalised, he added. The bank has exposure to two of the accounts referred by the Reserve Bank of India (RBI) under the provisions of Insolvency and Bankruptcy Code, 2016. The exposure to these two accounts, namely Orchid Pharma and Loha Ispaat, had been declared as NPA and provided them fully in the earlier years. The total exposure to these two companies is to the tune of Rs 40 crore. The advances for the nine months ended December 31, 2017, stood at Rs 26,089 crore as compared to Rs 21,801 crore in the same period last fiscal, registering a growth of 20%. Deposits registered a 5% rise to Rs 31,339 crore, as compared to Rs 29,989 crore.