State-owned Union Bank of India on Thursday reported a 6.6 per cent increase in net profit year-on-year to ₹5,316 crore for the fourth quarter of FY26, compared with ₹4,985 crore in the year-ago period, aided by lower provisions and operating expenses. Sequentially, net profit rose 6 per cent from ₹5,017 crore in Q3FY26.
Provisions declined 2.76 per cent year-on-year to ₹2,640 crore from ₹2,715 crore in Q4FY25. However, on a sequential basis, provisions rose sharply by 37.1 per cent from ₹1,925 crore in Q3FY26, mainly due to a one-time increase in standard asset provision of ₹700 crore.
Operating expenses declined 6.9 per cent year-on-year and 0.9 per cent sequentially to ₹6,863 crore in Q4FY26.
Net interest income (NII) for the quarter stood at ₹9,406 crore, marginally lower by 1.1 per cent year-on-year, but up 0.8 per cent sequentially. Interest earned declined 4.5 per cent year-on-year to ₹26,439 crore, while interest expenses fell 6.3 per cent to ₹17,033 crore.
Net interest margin (NIM) moderated to 2.64 per cent in Q4FY26, from 2.76 per cent in the previous quarter. NIM in Q4FY25 was 2.87 per cent.
“We have seen a cumulative repo rate reduction of 125 basis points, of which about 53–54 per cent has been transmitted. Despite this, our margins have remained relatively stable, with NIM moderating only from 2.91 per cent (FY25) to 2.70 per cent (FY26), a decline of just 21 basis points,” said Asheesh Pandey, MD & CEO, Union Bank of India.
Other income declined 2.6 per cent year-on-year to ₹5,412 crore in Q4 but rose 19.2 per cent sequentially. Treasury income declined sharply to ₹636 crore in Q4FY26, down 61.4 per cent year-on-year and 29.4 per cent sequentially.
“Treasury income has declined during the period due to market conditions. As far as regulatory limits are concerned, including the RBI’s cap on overnight positions, our exposure remained well within limits at around $30 million. We maintained a cautious stance and avoided taking large positions during a volatile phase, which ensured there was no material impact on earnings,” Pandey said.
Operating profit before provisions and contingencies increased 3.3 per cent year-on-year to ₹7,955 crore and rose 14.6 per cent sequentially.
“Other income in the previous year included a one-off recovery of ₹787 crore from the sale of two NARCL-backed accounts, which had sovereign guarantee support. Adjusting for that, other income declined by about 1.9 per cent year-on-year,” Pandey added.
On the asset quality front, gross non-performing assets (GNPA) declined 14 per cent year-on-year to ₹30,401 crore, while net NPAs fell 15.1 per cent to ₹5,067 crore during the same period. In percentage terms, the GNPA ratio improved to 2.82 per cent from 3.60 per cent a year ago, while the net NPA ratio eased to 0.48 per cent from 0.63 per cent.
On the business front, total advances grew 9.7 per cent year-on-year to ₹10.79 trillion and 6.1 per cent sequentially, indicating steady credit demand. Deposits, however, were largely flat on a yearly basis at ₹13.07 trillion, though they rose 6.9 per cent quarter-on-quarter.
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