After Rs 1.6k cr loss in 9 months, UBI posts Rs 469cr profit in Q4

 

KOLKATA: The beleaguered Kolkata-based public sector lender, United Bank of India (UBI), has made a turnaround in the fourth quarter of 2013-14 following consecutive losses mounting to Rs 1,683 crore in the first nine months.

The government-run bank has posted a net profit of Rs 469 crore in the quarter ended March 31, 2014, from Rs 31 crore in the corresponding quarter of 2012-13. Terming it as a major achievement, UBI executive director Deepak Narang said it was achieved following better recovery and upgradation of assets in the fourth quarter.

UBI witnessed a record loss in the third quarter of 2013-14 and the bank's CMD, Archana Bhargava, had to resign following mounting non-performing assets. RBI had put a bar on credit expansion of the bank as well.

Announcing the results, UBI executive director Sanjay Arya, said the bank is now complying with the required capital adequacy ratio (CAR) and will approach RBI for credit expansion.

"The capital adequacy ratio (CAR) is now 9.81% compared to 9% as per Basel III norms. RBI had asked to go slow on credit expansion earlier. Now following the profit in this quarter, our CAR will again fulfill the requirements. The loss for 2013-14 will come down to Rs 1213 crore following this."

However, Arya pointed out that despite better recovery and profit, it would remain cautious on big-ticket loans. "Our thrust will be on retail, MSME and priority sector lending. This is not the right time for big ad-vances. Unless industry scenario improves, it is not possible to have higher exposure in big-ticket loans," Arya added.

There was a de-growth of advance portfolio of UBI in the fourth quarter. The advance stands at Rs 67,982 crore, a degrowth of 2.48% in year-on-year basis. According to him, the gross non-performing asset (NPA) has gone down to Rs 7,118 crore in the quarter from Rs 8,546 crore. "There were fresh slippages of Rs 1,611 crore during the quarter but the recovery and upgradation was much more than that," he added.

The cash recovery during the quarter was Rs 645 crore out of Rs 1,084 crore total cash recovery during the fiscal. The account upgrades during the quarter was to the tune of Rs 1,488 crore. "We have done corporate debt restructuring of six-seven accounts to the tune of Rs 1020 crore," said Arya.

 

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