Union Bank Q1 result: Net profit up by 108% to Rs 3,236cr

Union Bank of India

Union Bank of India’s see a growth of 108 per cent year-on-year (YoY) in net profit to Rs 3,236 crore in the first quarter, ended June 30, 2023 (Q1FY24) due to rise in net interest income (NII), non-interest income, and a fall in provisions for bad loans.

In Q1 FY24, the lender’s net interest income (NII) increased 16.6 per cent to Rs 8,840 crore from Rs 7,582 crore in the same quarter the previous year. In terms of sequence, NII increased 7.14 per cent from Rs 8,251 crore in Q4 FY23.

In the first quarter of FY24 compared to the first quarter of FY23, net interest margin (NIM) increased by 13 basis points (bps) to 3.13 per cent. NIM increased sequentially from 2.98 per cent in Q4 FY23, according to a press release from the bank.

Non-interest revenue increased by 38.57 per cent YoY to Rs 3,903 crore. Sequentially, it decreased from Rs 5,269 crore in Q4 FY23 by 25.92 per cent.

Non-performing asset (NPA) provisions made by the lender decreased from Rs 3,652 crore in Q1 FY23 to Rs 1,984 crore in Q1 FY24. In Q1 FY24, advances increased 12.33 per cent YoY to Rs 8.18 trillion. To reach Rs 11.28 trillion, total deposits climbed 13.63 per cent year over year.

Current account and saving account (CASA) share of low-cost deposits decreased from 36.2 to 34.6 per cent at the end of June 2023. With gross NPAs falling from 10.22 per cent in June 2022 to 7.34 per cent in June 2023, the asset quality profile improved.

Additionally, Net NPAs decreased from 3.31 per cent a year earlier to 1.58 per cent in June 2023.

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In June 2023, the provision coverage ratio (PCR) increased from 84.75 to 90.86 per cent. At the end of June 2023, capital adequacy was 15.95 per cent and Tier-1 was 13.86 per cent.

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