United Bank of India’s Q2 net profit falls 30% to Rs43.53 crore on bad loans
United Bank of India reported a net profit of Rs43.53 crore in the September quarter against Rs61.86 crore in the year-ago period
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Mumbai: United Bank of India (UBI) on Monday reported a 30% fall in its net profit for the September quarter due to higher provisions against bad loans and lower net interest income.
The bank reported a net profit of Rs43.53 crore in the quarter, down from Rs61.86 crore a year ago.
Net interest income (NII), or the core income a bank earns by giving loans, fell 41.07% to Rs376.40 crore in the September quarter from Rs638.72 crore a year ago.
Non-interest income increased 76.7% to Rs661.20 crore from Rs374.19 crore a year ago. The bank reported a tax write-back of Rs7.97 crore against tax expenses of Rs58.69 crore a year ago. Employee costs fell 26.6% to Rs384 crore.
Gross non-performing assets (NPAs) at United Bank rose 10.07% to Rs11,134.47 crore at the end of the September quarter from Rs10,116.13 crore in the June quarter. On a year-on-year basis, gross NPAs jumped 82.17%. As a percentage of total loans, gross NPAs stood at 16.26% at the end of the September quarter as compared to 14.29% in the previous quarter and 8.9% in the year-ago quarter.
Provisions and contingencies rose 45.7% to Rs401.03 crore in the quarter from Rs275.26 crore a quarter ago. On a year-on-year basis, provisions jumped 145.9%.
Net NPAs were at 11.19% in the September quarter compared to 9.85% in the previous quarter and 5.61% in the same quarter last year.
Total deposits rose 5.78% from a year ago to Rs117,892.57 crore while total advances fell 2.66% to Rs64,489.88 crore.
United Bank said in a notice to BSE that it will sell up to Rs300 crore of shares to Life Insurance Corporation of India in a preferential allotment.
On Monday, UBI shares closed at Rs21.50, an increase of 3.61%, while BSE’s benchmark Sensex gained 0.68% to close at 27,458.99 points.