City Union Bank could report a 15.3 per cent rise in its net profit at Rs. 102.70 crore in the third quarter ended December 31, 2014, against Rs. 89.09 crore in the same period year-ago despite making higher provisions towards taxation and against non-performing assets. The operating profit rose by 25 per cent to Rs. 168.29 crore from Rs. 134.66 crore in the same period in the previous year.
Addressing presspersons here on Saturday, N. Kamakodi, Managing Director and CEO, said the bank had made full provision of Rs. 38.50 crore in respect of taxation against Rs. 16.50 crore (minimum alternate tax) in the year-ago period while provision against non-performing assets accounted for Rs. 27.70 crore (Rs. 22.50 crore). Thus the amount set aside towards provisioning rose by 44 per cent compared to the year-ago period.
Mr. Kamakodi said “the results are much better than what we have anticipated and what we prepared ourselves for.” The bank has also made profits through treasury operations and foreign exchange, Mr. Kamakodi said. The third quarter was significant for the bank as it recorded Rs. 100 crore profit in a quarter for the first time in its history while it crossed the Rs. 40,000 crore mark in respect of total business, he said.
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Total income for the quarter under reference rose by 10.9 per cent to Rs. 782.28 crore from Rs. 705.12 crore with non interest income registering a rise of 65.8 per cent to Rs. 97.78 crore from Rs. 58.98 crore.
Net interest income registered a rise of 6 per cent to Rs. 209.77 crore in the third quarter with the net interest margin at 3.48 per cent. Mr. Kamakodi said the gross non-performing assets ratio stood at 2.12 per cent against 1.7 per cent with a rise of nearly Rs. 100 crore on absolute terms. The net NPA was almost steady at 1.31 per cent (1.30 per cent). The recovery was slightly getting delayed due to slowdown in real estate market, Mr. Kamakodi said.
He said the exposure to SpiceJet was Rs. 100 crore (net of financial collateral). Interest payments were being made regularly by the client and there was no overdue in the account, he said.
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The bank reported a 9.9 per cent growth in deposits at Rs. 23,203 core as on December 31, 2014, against Rs. 21,116 crore as on December 31, 2013. Advances rose by 7.22 per cent to Rs. 16,968 crore from Rs. 15,825 crore during the period.