Union Bank of India Q3 up 49.76% at Rs1,077cr on -11.6% lower overall provisioning in Q3

7 Feb 2022 , 07:05 PM

Union Bank of India reported -3.48% fall in total consolidated revenues in the Dec-21 quarter at Rs20,233cr. Revenues of BOB were up 6.42% on a sequential basis. In terms of top line revenues,

Union Bank saw marginal growth in revenues from wholesale banking vertical. However, revenues from retail banking were marginally lower while treasury revenues fell sharply in Q3. The net interest income (NII) was up 8.88% at Rs7,174cr in the quarter while the non-interest income was down -15% yoy at Rs2,524cr.

Domestic advances were up 2.91% led by agriculture lending, MSME lending and retail lending in the quarter. Deposits grew by 6.24% yoy while CASA deposits grew by 11.06% on yoy basis. CASA ratio improved by 161 bps yoy to 36.99% as share of total deposits.

For the Dec-21 quarter, the operating profits were down -3.7% at Rs5,091cr. Net interest margins or NIM improved yoy by 6 bps at 3.00%, but still lower than private sector counterparts.

The provision coverage ratio (PCR) tapered yoy to 82.8% while the credit cost was also lower by 46 bps yoy at 1.40% in the Dec-21 quarter.

Operating margin or OPM was almost flat at a level of 25.16% in Dec-21 quarter. OPM was however, sharply lower sequentially compared to 27.98% in the sequential quarter.

Profit after tax (PAT) for the Dec-21 quarter was up by 49.76% at Rs1,077cr. This was largely on account of a sharp -11.57% fall in provisions for loan losses and contingencies in the quarter at Rs4,013cr.

Gross NPAs tapered lower from 13.49% to 11.62% in the quarter but remains high by absolute standards. Net NPA ratio was higher by 82 bps at 4.09% on lower provisioning.  Capital adequacy at 13.85% remains a concern.

PAT margins improved sharply from 3.43% to 5.32% on a yoy basis. Net margins were lower on a sequential basis by 167 basis points.

Financial highlights for Dec-21 compared yoy and sequentially

	Union Bank of India
Rs in Crore	Dec-21	Dec-20	YOY	Sep-21	QOQ
Total Income	₹ 20,233	₹ 20,963	-3.48%	₹ 21,622	-6.42%
Operating Profit	₹ 5,091	₹ 5,287	-3.70%	₹ 6,049	-15.83%
Net Profit	₹ 1,077	₹ 719	49.76%	₹ 1,511	-28.68%
Diluted EPS	₹ 1.55	₹ 1.12		₹ 2.25
Operating Margins	25.16%	25.22%		27.98%
Net Margins	5.32%	3.43%		6.99%
Gross NPA Ratio	11.62%	13.49%		12.64%
Net NPA Ratio	4.09%	3.27%		4.61%
Return on Assets (Ann)	0.39%	0.28%		0.56%
Capital Adequacy	13.85%	12.94%		13.57%