Union Bank of India Q2 Net profit jumps 34%

Public sector lender Union Bank of India (UBI) reported a significant 34% year-on-year increase in consolidated net profit for the second quarter of FY2025, reaching ₹4,720 crore, compared to ₹3,511 crore in the same quarter last year.

This profit surge was primarily supported by a reduction in provisions and contingencies. The bottom line rose 28% sequentially.

NII declined marginally by 0.9% to ₹9,047 crore from ₹9,126 crore a year ago, as interest expenses rose slightly during the quarter. Despite this, total income remained steady, supported by a healthy contribution from non-interest income sources and recovery from written-off accounts.

The bank’s asset quality continued to improve during the quarter. The gross non-performing assets (NPA) ratio fell to 4.36% as of September 2024, down from 4.54% in the previous quarter, and showing a sharper decline from 6.38% in Q2 FY2024.

Similarly, the net NPA ratio was recorded at 0.98%, up from 0.90% in the previous quarter, but a good improvement from 1.30% in the same quarter last year.

Additionally, Union Bank of India maintained a provision coverage ratio (PCR) of 92.79%, ensuring adequate coverage for potential defaults. The bank’s capital adequacy ratio under Basel III guidelines stood at 17.13%, comfortably above regulatory requirements.

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Union Bank of India Q1 profit rises 13.7%

Union Bank of India on July 19 reported a 13.68 percent on-year rise in its profit after tax to Rs 3,679 crore in the first quarter of the current financial year.

On sequential basis, net profit rises 11.11 percent.

Gross non-performing assets (NPA) ratio of the banks reduced to 4.54 percent as on June 30, as compared to 4.76 percent in a quarter ago period and 7.34 percent in a year ago period.

Net NPA ratio of the lender eased to 0.90 percent as on June 30, as against 1.03 percent in a quarter ago period and 1.58 percent in a year ago period.

In the reporting quarter, provision coverage ratio of the bank stood at 93.49 percent as in June 30, as compared to 92.69 percent as on March 31, and 90.86 percent as on June 30, 2023.

In April-June, interest income of the lender stood at Rs 26,364 crore, which was up 12.29 percent on a yearly basis. It stood at Rs 23,478 crore in a year ago period.

Total deposit of Union Bank of India stood at Rs 12.24 lakh crore as on June 30, 2024, as against Rs 11.28 lakh crore as on June 30, 2023.

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Union Bank of India Q4 Results: PAT Jumps 19%; NII Up 14%; Dividend Declare

 

Union Bank of India reported a 19 per cent year-on-year (yoy) increase in fourth quarter standalone net profit at ₹3,310.55 crore, supported by growth in net interest income (NII) and sharp decline in loan loss provisions

The public sector bank had reported a net profit of ₹2,782 crore in the year-ago quarter.

Its board has recommended a dividend of ₹ 3.60 per equity share of ₹ 10 each for FY24.

Net interest income/NII (difference between interest earned and interest expended) rose 14 per cent yoy to ₹9,437 crore (₹8,251 crore in Q4FY23).

Total non-interest income, comprising fee income (loan processing charges, miscellaneous fee income, etc), forex income, profit or loss on sale/revaluation of investments, etc, declined 11 per cent to ₹4,707 crore (₹5,269 crore).

Loan-loss provisions declined 58 per cent to ₹1,485 crore (₹3,567 crore).

Asset quality improved, with gross non-performing assets (NPAs) declining to 4.76 per cent of gross advances as at March-end 2024 against 4.83 per cent as at December-end 2023. NNPAs nudged lower to 1.03 per cent of net advances from 1.08 per cent.

As on March-end 2024, gross advances increased by 14.29 per cent yoy to ₹8,70,776 crore. Total deposits rose 9.28 per cent to ₹12,21,528 crore.

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BoB, PNB among 6 PSU banks with high NPAs

Non Performing asset (NPA) is a loan or advance for which the principal or interest payment has remained overdue for a period of 90 days or more. According to data from Trendlyne, SBI, Bank of Baroda, and PNB are among the 6 PSU banks that reported the highest NPAs in Q3 of FY24. Here's the list:

Bank of India(BoI)

The net NPA of Bank of India stood at 1.41% in Q3FY24, which is the highest among PSU Banks. The PE ratio of the stock is 9.66. Bank of India has a market cap of Rs 61,870 crore.

Union bank of India

Union Bank of India reported a net NPA of 1.08% in Q3FY24. The PE ratio of the stock is 7.74. The firm's market cap is at Rs 1,02,773 crore.

Punjab National Bank (PNB)

Punjab National Bank (PNB) reported a net NPA of 0.96% in Q3FY24. The PE ratio of the stock is at 17.76. Punjab National Bank's market cap is at Rs 1,35,490 crore.

Bank of Baroda(BoB)

The net NPA ratio of Bank of Baroda stood at 0.7% in the December quarter of FY24. The PE ratio of the stock is 7.3. It has a market cap of Rs 1,38,153 crore.

State Bank of India (SBI) 

The net NPA ratio of the State Bank of India (SBI) stood at 0.64% in Q3FY24. The PE ratio of the stock is 10.26. SBI has a market cap of Rs 6,65,731 crore.

Indian Overseas Bank(IOB)

Indian Overseas Bank reported a net NPA of 0.62% in the December quarter of FY24. The PE ratio of the stock is at 50.36, while its market cap is at Rs 1,26,457 crore.

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Union Bank of India Q3 Profit rises 60%

State-owned lender Union Bank of India reported a 60 percent rise in standalone net profit at Rs 3,589.91 crore for the fiscal third quarter. The net profit is in line with Motilal Oswal’s estimate of Rs 3,558.2 crore .

On sequential basis, net profit of the lender was up just 2.24 percent. In July-September quarter, Union Bank of India reported a net profit of Rs 3,511.42 crore.

On sequential basis, net profit of the lender was up just 2.24 percent. In July-September quarter, Union Bank of India reported a net profit of Rs 3,511.42 crore.

This was on back of improved asset quality and increase in net interest income.

The bank's gross non-performing asset (NPA) stood at 4.83 percent, down from 6.38 percent in the September quarter and 7.93 percent in the year-period, the lender said on January 20.

The bank's net NPAs stood at 1.08 percent against 1.30 percent in the pervious quarter and 2.14 percent in Q3FY23.

In absolute terms, the gross NPA of the banks stood at Rs 43,261.88 crore in October-December quarter, as against Rs 54,012.76 crore in a quarter ago period and Rs 63,770.16 crore in a year ago period.

Similarly, net NPA of the lender eased to Rs 9,351.23 crore in a reporting quarter, from Rs 10,471.01 crore in a quarter ago period and Rs 16,195.11 crore in a year ago period.

The net interest income (NII) of the lender in the reported quarter rose just 6.26 percent on-year to Rs 9,168 crore. In July-September quarter, NII stood at Rs 9,126 crore.

The non-interest income of the bank increased 15.29 percent on-year to Rs 3,774 crore. On sequential basis, net non-interest income rose 2.14 percent.

In October-December quarter, net interest margins (NIM) of the bank 3.08 percent, which was down 13 basis points (Bps) on-year and 10 bps on quarter.

One basis point is one hundredth of percentage point.

In a business update earlier this month, the lender reported a 10.67 percent year-on-year (YoY) growth in business at Rs 20.68 lakh crore in the December quarter.

The bank's total advances experienced an 11.44 percent YoY increase, reaching Rs 8.96 lakh crore, while deposits saw a notable 10.09 percent jump to Rs 11.72 lakh crore during Q3FY24.

Retail, Agri and MSME (RAM) segments of the Bank increased by 13.85 percent on-year , where 12.60 percent growth in Retail, 17.88 percent growth in Agriculture and 10.51 percent growth in MSME advances is achieved on a yearly basis.

RAM advances as a percent of Domestic Advances stood at 56.28 percent.

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Latest Bank merger news of PSU banks and PSU Insurance Company

 

A government document shared on social media has triggered speculation about possible PSU bank mergers between Union Bank and UCO Bank, and Bank of India and Bank of Maharashtra. The document, whose source couldn't be verified, said that a Parliamentary committee will hold discussions with four PSU banks in the first week of January under banking laws, which govern mergers and acquisitions, among other things.

However, the government has not yet provided official information regarding the merger. Neither of the four PSU banks mentioned have made any stock exchange filings in this regard.

The document being circulated on X (formerly Twitter) is a government PDF issued in the name of Ramesh Yadav, Under Secretary of the Government of India. The letter is issued to the Governor, Reserve Bank of India, Chairman of LIC, IRDAI, and NABARD, along with MD and CEOs of UCO Bank, Bank of Maharashtra, Bank of India, and Union Bank of India.

The PDF is also addressed to CMDs of New India Assurance Company, United India Insurance Company, Oriental Insurance Company, National Insurance Company, and MD & CEO of SBI Life Insurance Company. The subject of the alleged government PDF states 'Study Visit programme of the Committee on Subordinate Legislation, Lok Sabha to Mumbai and Goa from 2 to 6 January 2024'.

The 2-day programme includes informal discussions with the representatives of Union Bank of India and UCO Bank on January 2, and with representatives of Bank of Maharashtra and Bank of India on January 4, 2024, on rules/regulations framed under Banking Regulations Act 1949 and other relevant Acts as applicable to them and the regulatory mechanism in post-merger scenario.

The Finance Ministry has reportedly issued a clarification, saying that this is a parliamentary committee on subordinate legislation, and it has no connection whatsoever with the policies of bank mergers, according to CNBC-Awaaz. Amid the merger buzz, the ministry reportedly changed the agenda of its meeting. According to the new agenda, there is no mention of the word “Merger”, which simply means that there is no proposal for a merger between Union Bank of India and UCO Bank, Bank of India, and Bank of Maharashtra, said CNBC Awaaz in its report.

Meanwhile, No proposal to merge the public sector banks is being considered by the government and the discussions were part of a ‘routine exercise, Reuters also reported citing two sources from the Ministry of Finance.

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Union Bank Of India Q2 Profit Jumps 90%

 

Union Bank of India's profit jumped 90% in the July–September quarter on account of a significant drawdown in provisions.

The public sector lender reported a net profit of Rs 3,511 crore in the second quarter of fiscal 2024 as compared with Rs 1,847 crore over the same period last year, according to an exchange filing on Friday. Analysts polled by Bloomberg pegged its standalone net profit at Rs 3,139 crore.

Sequentially, the bottom line rose 8.5%.

The net interest income increased 10% to Rs 9,126 crore from Rs 8,305 crore in the year-ago period. As on Sept. 30, the net interest margin stood at 3.18%, up 5 basis points from the quarter ended June.

The bank's domestic advances grew 9.2% year-on-year to Rs 8.2 lakh crore during the quarter, propped up by a strong pickup in education and gold loans. However, the absolute share of the two segments in the loan mix was low.

Domestic deposits increased 7.4% to Rs 11.2 lakh crore in the second quarter. As of Sept. 30, the current account and savings account ratio stood at 34.6%.

The bank met the priority sector lending requirements as prescribed by the Reserve Bank of India, under which all banks have to lend 40% of the adjusted net bank credit towards agriculture, micro enterprises and other economically disadvantaged sections.

The share of loans disbursed to women by the bank was exceedingly well above the 5% benchmark set by the RBI under its PSL norms, according to the investor presentation.

The bank's operating expenses rose nearly 12% to Rs 5,600 crore during the reporting period.

Union Bank of India's asset quality improved, with the gross non-performing assets ratio at 6.38% from 7.34% in the previous quarter. The net NPA ratio fell 28 bps to 1.3%, from 1.58% in the first quarter.

While fresh slippages during the quarter amounted to Rs 2,527 crore, accounts worth Rs 984 crore were upgraded. Loans worth Rs 6,018 crore were written off during the period.

Of the total provisions, the amount set aside for bad loans was Rs 1,691 crore during the quarter, nearly 40% lower than what was provided in the same quarter of the previous year.

The bank's provision coverage ratio stood at 92.03% as of Sept. 30. Its capital adequacy ratio was at 16.69%, with CET-1 ratio at 13.05% and tier-II at 2.12%. Out of Rs 10,100 crore approved by the board to be raised this financial year, the bank has already raised Rs 5,000 crore through equity.

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Union Bank Of India Q1 Results: Profit more than Doubles, Provisions Drop

 

Union Bank of India on July 20 reported a more than 107 percent on-year rise in its standalone net profit to Rs 3,236.44 crore in the first quarter of the current financial year.

This is on the back of improvement in the asset quality, lower provisions and increase in net interest income.

In the similar period last year, the state-owned lender reported Rs 1,558.46 crore profit.

On a sequential basis, net profit rose 16.32 percent, Union Bank of India said in an exchange filing.

In the reporting quarter, the net interest income of the lender increased 16.59 percent on-year to Rs 8,840 crore. Similarly, on the sequential basis, it rose 7.14 percent.

While, the non-interest income of the bank rose 38.57 percent on-year in April-June quarter to Rs 3,903 crore. However, it fell sharply over 25 percent on-quarter.

The net interest margins of the bank increased to 3.13 percent in June quarter, which is up 13 basis points (Bps) on-year, and 15 bps on-quarter.

In the similar quarter last year, the state-owned lender reported net interest margins of 3.00 percent. One basis point is one hundredth of percentage point.

Net interest margins is a measure of difference between interest earned by the lender and interest it pays out to its lenders.

Asset quality

In April-June quarter, Union Bank of India reported an improvement in the asset quality, with gross non-performing asset (NPA) ratio improved by 288 bps and net NPA decreased by 173 bps compared to year ago period.

According to the press release, gross NPA of the bank fell to 7.34 percent as on June 30, as compared to 7.53 percent in the previous quarter, and 10.22 percent in a year ago period.

Similarly, net NPA of the bank decreased to 1.58 percent in April-June quarter, as against 1.70 percent quarter ago.

In absolute terms, gross NPA stood at Rs 60,104 crore, down 19.32 percent on-year, and net NPA stood at Rs 12,138 crore, down 45.79 percent, as per press release.

Provision coverage ratio of the bank also increased by 611 bps to 90.86 percent in the reporting quarter.

The total provisions of the bank in first quarter of the current financial year rose marginally by 1.38 percent on-year to Rs 3,943 crore.

Advances & Deposit

The global and domestic advances of the state-owned lender increased 12.33 percent and 11.77 percent on-year, respectively in June quarter.

According to the press release, global advances stood at Rs 8.19 lakh crore and domestic advances stood at 7.94 lakh crore in April-June.

Deposits rose 13.63 percent 0n-year to Rs 11.28 lakh crore.

However, retail term deposit less than Rs 2 crore fell 0.58 percent on-year to Rs 4.36 lakh crore. On sequential basis, it fell 0.43 percent.

Financial inclusion schemes

During the quarter ending June 30, Union Bank of India done new enrollment of 4.63 lakhs Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY).

Similarly, accounts opened by banks under Pradhan Mantri Jan Dhan Yojana (PMJDY) increased 14.06 percent on-year to 2.84 Crores accounts under the Scheme with balance of Rs. 9,002 crore during the quarter ending June 30.

In the corresponding quarter last year, the figure was 2.49 crores account with balance of Rs 7,827 crore.

Under Union Nari Shakti Scheme for Women Entrepreneurs, the bank sanctioned 6,538 applications for Rs 617 crore during Q1 FY24.

In the reporting quarter, the bank sanctioned Rs 10,939 crore towards renewable energy sector and Rs 260 crore towards Union Green Mills.

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