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Union Bank of India Q3 result: Profit up 107% at Rs 2,245 crore, asset quality improvement – Moneycontrol

Union Bank of India Q3 result: Provisions and contingencies at Rs 3,036 crore were up 19 percent from the year-ago quarter but fell 25.5 percent sequentially

Sunil Shankar Matkar

January 20, 2023 / 02:56 PM IST

Union Bank of India on January 20 reported a standalone profit of Rs 2,245 crore for the December quarter, up 106.81 percent from the year-ago period, with healthy improvement in asset quality and double-digit growth in net interest income.

The lender’s non-interest income as well as pre-provision operating profit grew 30 percent each on year basis.

The net interest income, the difference between interest earned and interest expended, grew by 20.3 percent year on year (YoY) to Rs 8,628 crore, with the net interest margin improving by 21 bps (up 6 bps QoQ) to 3.21 percent compared to the year-ago period.

The public sector lender in its BSE filing said its total business increased by 16.31 percent on-year, with gross advances rising by 20 percent and total deposits growing 13.61 percent for the quarter. Its total business as of December 2022 stood at Rs 18.69 lakh crore.

Its total deposits base at the end of December was at Rs 10.65 lakh crore with CASA deposits growing by 8.43 percent YoY to Rs 3.75 lakh crore, while the total advances as of Q3FY23 was at Rs 8.04 lakh crore, with RAM (retail, agriculture and MSME which contributed to 53.3 percent of advances) segment showing 17.8 percent on-year growth.

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Provisions and contingencies at Rs 3,036 crore at the end of the December quarter were up 19 percent from the year-ago quarter but fell 25.5 percent sequentially. The provision coverage ratio improved to 88.50 percent in Q3FY23, up by 189 bps from 86.61 percent in Q2FY23.

Asset quality improved sequentially as well as on-year basis, with gross non-performing assets as a percentage of gross advances falling 52 bps QoQ to 7.93 percent and net NPA declining 50 bps to 2.14 percent for the quarter.

Union Bank share price was trading flat at Rs 81.60 at the time of writing this article.

Sunil Shankar Matkar