 "Union Bank eyes Rs 1,200- cr recovery from small-size NPAs")
Government-owned Union Bank of India (UBI) aims to recover Rs 1,200 crore of small-size loans it had made and bring down its total of gross non-performing assets (NPAs) to 8.75-9 per cent of the total by next March.
Its stock closed sharply lower by 6.5 per cent to Rs 128 on the BSE. Its June quarter results had been announced over the weekend, with net profit declining to Rs 167 crore from Rs 519 crore in April-June 2015, on a sharp rise in provisioning for stressed assets.
Arun Tiwari, chairman and managing director, told this newspaper they expected to recover Rs 1,200 crore as mentioned earlier from smaller NPAs this financial year. The bank is regularly conducting camps as part of recovery drive and these would show results, he said.
Asset quality slippage came down from the earlier quarter by 41.6 per cent, to Rs 3,603 crore from Rs 6,170 crore in December-March. All public sector banks had reported a sharp rise in such slippage in the third and fourth quarters of FY16, as a consequence of the Reserve Bank's asset quality review.
Cash recovery in the June quarter rose to Rs 350 crore from Rs 204 crore in the March one. It was Rs 160 crore in the June quarter of FY16.
As for recoveries from large-size stressed assets, Tiwari said while coordinated efforts are on by lenders, much depends on an improvement in the macro economic and business environment.
Most of the big NPA accounts are consortium ones, limiting the room for individual banks to chart an independent course for recovery.
Union Bank saw its gross NPAs rising to 10.16 per cent at end-June from 8.7 per cent in end-March and 5.53 per cent in end-June 2015. The net NPA ratio was 6.16 per cent at end-June, from 5.25 per cent at end-March and 3.08 per cent a year before.
The provision coverage ratio was 50 per cent at end-June, from 58 per cent a year before and 51 per cent at end-March.
Its stock closed sharply lower by 6.5 per cent to Rs 128 on the BSE. Its June quarter results had been announced over the weekend, with net profit declining to Rs 167 crore from Rs 519 crore in April-June 2015, on a sharp rise in provisioning for stressed assets.
Arun Tiwari, chairman and managing director, told this newspaper they expected to recover Rs 1,200 crore as mentioned earlier from smaller NPAs this financial year. The bank is regularly conducting camps as part of recovery drive and these would show results, he said.
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Asset quality slippage came down from the earlier quarter by 41.6 per cent, to Rs 3,603 crore from Rs 6,170 crore in December-March. All public sector banks had reported a sharp rise in such slippage in the third and fourth quarters of FY16, as a consequence of the Reserve Bank's asset quality review.
Cash recovery in the June quarter rose to Rs 350 crore from Rs 204 crore in the March one. It was Rs 160 crore in the June quarter of FY16.
As for recoveries from large-size stressed assets, Tiwari said while coordinated efforts are on by lenders, much depends on an improvement in the macro economic and business environment.
Most of the big NPA accounts are consortium ones, limiting the room for individual banks to chart an independent course for recovery.
Union Bank saw its gross NPAs rising to 10.16 per cent at end-June from 8.7 per cent in end-March and 5.53 per cent in end-June 2015. The net NPA ratio was 6.16 per cent at end-June, from 5.25 per cent at end-March and 3.08 per cent a year before.
The provision coverage ratio was 50 per cent at end-June, from 58 per cent a year before and 51 per cent at end-March.