Mumbai : State-run Union Bank of India reported a 34 per cent increase in net profit at Rs 104 crore in the third quarter ended December, helped by higher treasury gains and lower cost of deposits, reports PTI.
The lender had reported a profit after tax of Rs 78 crore in the same quarter last year. Treasury income rose 95 per cent to Rs 822 crore from Rs 421 crore in the quarter. Flushed with low cost deposits following the Centre’s move to demonetise Rs 500 and Rs 1,000 notes, the bank’s cost of deposits fell to 6.35 per cent from 7.03 per cent. Domestic net interest margins stood at 2.04 per cent as against 2.31 per cent a year ago. Global NIM was at 2.01 per cent from 2.22 per cent.
“We had given a NIM guidance of 2.22-2.25 per cent for this year. In the third quarter, 23 per cent of term loans have been repaid which was high cost and this will help us in meeting our NIM target,” CMD Arun Tiwari told reporters here. Gross non-performing assets rose to 11.70 per cent from 7.05 per cent, while net NPA stood at 6.95 per cent from 4.07 per cent. Provision coverage ratio stood at 50.62 per cent.
