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UBI's net jumps by 32% to 1,558 cr in Q1
UBI’s net jumps by 32% to 1,558 cr in Q1
Union Bank of India (UBI) Tuesday reported a 32 per cent rise in its standalone profit after tax (PAT) to Rs 1,558 crore for the June quarter on higher net interest income and improvement in asset quality.
Mumbai: Union Bank of India (UBI) Tuesday reported a 32 per cent rise in its standalone profit after tax (PAT) to Rs 1,558 crore for the June quarter on higher net interest income and improvement in asset quality. It had reported a standalone PAT of Rs 1,181 crore in the corresponding quarter of the preceding fiscal.
The bank's Managing Director and CEO A Manimekhalai said the good result was on account of growth in net interest income (NII), a decline in bad loans ratio and higher credit and deposit growth. "We are hoping that even in the September quarter the bank will be able to show good results," she told reporters. NII grew 8.11 per cent to Rs 7,582 crore against Rs 7,013 crore in the year-ago period. Net Interest Margin (NIM) dropped 8 basis points (bps) to 3 per cent from 3.08 per cent a year ago.
The gross non-performing asset (GNPAs) ratio improved to 10.22 per cent compared to 13.60 per cent. Net NPA stood at 3.31 per cent against 4.69 per cent. Fresh slippages were Rs 3,600 crore, which includes Rs 2,900 crore from the corporate book, Rs 900 crore from MSMEs and Rs 600 crore from retail. The lender is looking at slippages to the tune of Rs 13,000 crore for fiscal 2023, Manimekhalai said.
Recovery during the three-month ended June was Rs 4,200 crore and the bank is targeting recoveries worth Rs 15,000 crore during the fiscal, she said. Total provisions declined 5.65 per cent to Rs 3,889 crore against Rs 4,122 crore in the same quarter of the previous fiscal. Capital to Risk (Weighted) Assets Ratio (CRAR) improved to 14.42 per cent as of June 30, 2022, from 13.32 per cent as of June 30, 2021. CET 1 ratio improved to 10.68 per cent from 9.77 per cent. The bank may look at raising Rs 3,500 crore through the qualified institutional placement (QIP) route in the third quarter of the current fiscal, Manimekhalai said. The advances increased by 12.95 per cent on a year-on-year basis, while deposits grew by 9.27 per cent.
