Union Bank of India Q2 profit surges 195%

Union Bank of India’s second quarter standalone net profit soared 195 per cent year-on-year (y-o-y) to ₹1,526 crore against ₹517 crore, supported by healthy growth in non-interest income.

During the reporting quarter, the bank recovered ₹1,650 crore from the resolution of the DHFL account.

The public sector bank made 65 per cent provision towards its ₹2,558 crore exposure to the SREI group.

Net interest income was up 8.52 per cent y-o-y to ₹6,829 crore (₹6,293 crore in the year-ago period).

Non-interest income, comprising core fee-based income, treasury income and recovery in written-off accounts, jumped about 65 per cent y-o-y to ₹3,978 crore (₹2,406 crore).

Credit growth

Rajkiran Rai G, MD & CEO, emphasised that the bank will end FY22 with a credit growth of 6-8 per cent as demand is expected to pick up in the second half of the year.

The bank has about ₹50,000 crore of corporate loan sanctions and unutilised limits, he said.

Domestic advances declined about 2 per cent y-o-y to ₹6,19,137 crore. Overseas advances were down about 18 per cent y-o-y to ₹15,446 crore.

Rai said the bank has upped the NPA recovery target to ₹16,000 crore from ₹13,000 crore as recoveries in the first half of FY22 had already crossed ₹10,000 crore.

GNPA position improved to 12.64 per cent of gross advances as of September-end 2021 against 13.60 per cent in the preceding quarter.

Net NPAs position, too, improved a shade to 4.61 per cent of net advances vis-a-vis 4.69 per cent in the preceding quarter.