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Last Updated : Oct 29, 2018 04:12 PM IST | Source: Moneycontrol.com

Union Bank posts Q2 profit at Rs 139 cr on sharp fall in provisions; asset quality improves

Slippages dropped to Rs 2,667 crore in September quarter against Rs 4,652 crore in June quarter, Union Bank said, adding write-offs increased to Rs 1,868 crore against Rs 1,426 crore QoQ.

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Public sector lender Union Bank of India has posted second quarter profit at Rs 139.03 crore on sharp decline in provisions and improvement in asset quality. However, lower other income and operating income limited profitability.

The bank had reported loss at Rs 1,530.72 crore in same period last year.

Net interest income during the quarter grew by 7.4 percent year-on-year to Rs 2,493 crore with loan growth of 0.74 percent at Rs 2.93 lakh crore.

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Union Bank said deposits in Q2 increased 3.4 percent to Rs 3.99 lakh crore YoY.

Asset quality improved during the quarter ended September 2018. Gross non-performing assets (NPA) as a percentage gross advances dropped at 15.74 percent against 16 percent in previous quarter and net NPA also declined at 8.42 percent against 8.70 percent in June quarter.

In absolute terms, gross advances were lower by 1.6 percent sequentially at Rs 50,157.4 crore and net advances by 3.34 percent QoQ at Rs 24,657 crore in Q2FY19.

Slippages dropped to Rs 2,667 crore in September quarter against Rs 4,652 crore in June quarter, Union Bank said, adding write-offs increased to Rs 1,868 crore against Rs 1,426 crore QoQ.

Provisions and contingencies fell sharply by 25.73 percent quarter-on-quarter and 53.43 percent year-on-year to Rs 1,655.55 crore in the quarter ended September 2018.

Provision coverage ratio also improved to 57.66 percent in Q2FY19, from 56.49 percent in Q1FY19, the bank said.

Other income (non-interest income) plunged 26.11 percent to Rs 899.44 crore due to sharp fall of 75.10 percent in treasury income YoY. Operating profit slipped 8.6 percent to Rs 1,772 crore compared to year-ago.

Union Bank of India stock closed at Rs 69.75, up Rs 7.55, or 12.14 percent ahead of earnings announced after market hours.

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First Published on Oct 29, 2018 04:12 pm
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