Union Bank Dec quarter net edges up 4.5% to Rs 150 crore

Union Bank of India's net profit nudged up by 4.49 per cent to Rs 150.04 crore in the quarter ended December 31, 2003 as against Rs 143.58 crore in the corresponding quarter last year.

The bank's bottomline grew at a slower clip as profit on sale of investments was lower at Rs 81.72 crore in the reporting quarter as against Rs 105 crore in the year ago period and provisioning increased to Rs 206.10 crore compared with Rs 156.02 crore in Q3 of 2002-03.

In the nine months ended December 31, 2003, the bank's net profit was up by 35.61 per cent to Rs 475.79 crore (Rs 350.85 crore in Q3 of 2002-03).

The bank's board has declared an interim dividend of 20 per cent, subject to Reserve Bank of India's approval.

In the reporting quarter, total income increased by 4.89 per cent to Rs 1344.01 crore (Rs 1281.33 crore) and total expenses inched up a shade to Rs 987.87 crore (Rs 981.73 crore).

A break-up of the total income shows that interest earned increased by 6.62 per cent to Rs 1165.37 crore (Rs 1092.98 crore) while other income was down by 5.16 per cent to Rs 178.64 crore (Rs 188.35 crore).

A break-up of the expenses shows that interest expended declined by Rs 712.48 crore (Rs 727 crore) and other expenses was up by 8.11 per cent to Rs 275.39 crore (Rs 254.73 crore).

Union Bank chairman and managing director V Leeladhar said not very exciting credit offtake by the corporate sector forced the bank to look for greener pastures and lay thrust on retail lending.

A major chunk of the total advances of Rs 225 crore made in the reporting Q3 was to the housing/ retail sector.

Gross and net non-performing assets declined by Rs 107 crore and Rs 166 crore in the nine months of the financial year to Rs 2281 crore and Rs 1087 crore, respectively.

The gross NPAs to gross advances ratio declined 8.18 per cent as of December-end 2003 (10.26 per cent as of December-end 2002) and the net NPAs to net advances ratio fell to 4.07 per cent (5.60 per cent).

Yield on advances declined to 9.51 per cent as of December-end 2003 as against 10.51 per cent as of December-end 2002. Similarly, yield on investments fell to 9.24 per cent as against 10.22 per cent.