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City
Union Bank has reported 12% growth in net profit at Rs 173.00 crore for the quarter
ended June 2021. The bank has posted healthy 2% growth in net interest income
(NII), while the core fee income of the bank also improved 49% in Q1FY2022. The
Net Interest Margin (NIM) of the bank improved to 3.86% in Q1FY2022 on
sequential basis from 3.72% in Q4FY2021.
On
business front, the bank as has posted 7% growth in business with strong 5% rose
in loan book. The asset quality of the bank was impacted due to high slippages
of loans in Q1FY2022.
Asset quality moderates:
The fresh
slippages of loans were elevated at Rs 482.2 crore in the quarter ended June
2021.
The bank
has recorded recoveries of Rs 70.1 crore, upgradations of Rs 12.1 crore and
write-offs of Rs 257.8 crore in Q1FY2022.
The restructured
loan book of the bank has increased to Rs 1984 crore end June 2021 from Rs 1849.3
crore end March 2021
Provision
coverage ratio moderated to 63% from 64 % a quarter ago 68% a year ago
The capital
adequacy ratio of the bank is a strong at 19.50 8% with Tier 1 ratio of 18.51%
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Asset Quality Indicators: City Union Bank
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|
|
Jun-21
|
Mar-21
|
Dec-20
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Sep-20
|
Jun-20
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Variation
|
|
QoQ
|
YoY
|
|
Gross NPA (Rs Crore)
|
2035.35
|
1893.19
|
1071.69
|
1220.58
|
1346.09
|
8
|
51
|
|
Net NPA (Rs Crore)
|
1242.17
|
1075.19
|
527.15
|
631.44
|
716.35
|
16
|
73
|
|
% Gross NPA
|
5.59
|
5.11
|
2.94
|
3.44
|
3.90
|
48
|
169
|
|
% Net NPA
|
3.49
|
2.97
|
1.47
|
1.81
|
2.11
|
52
|
138
|
|
% Provision Coverage Ratio
|
63.00
|
64.00
|
73.00
|
70.00
|
68.00
|
-100
|
-500
|
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% CRAR - Basel III
|
19.58
|
19.52
|
17.39
|
17.36
|
16.77
|
6
|
281
|
|
Tier I - Basel III %
|
18.51
|
18.45
|
16.31
|
16.29
|
15.80
|
6
|
271
|
|
Variation in basis points for figures given in percentages and
in % for figures in Rs crore
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Business Highlights:
Steady business growth: Total business
of the bank has increased 7% to Rs 81001 crore end June 2021, driven by 9%
growth in deposits to Rs 44606 crore and 5% growth in advances to Rs 36396
crore end June 2021.
The Casa
deposits of the bank surged 22% to Rs 12299 crore end June 2021 driven by 24% jump
in the savings deposits to Rs 8962 crore. The current account deposits also
increased 15% to Rs 3337 crore
The Casa
ratio eased to 27.6% end June 2021 from 29.2% end March 2021.
The costs
of deposits have declined 5 bps qoq to 4.95%, while the yield on advances rose
on sequential basis to 9.40%. The net interest margin of the bank has improved
on sequential basis to 3.86% in Q1FY2022 from 3.72% a quarter ago, while eased
from 3.98% a year ago.
The bank
has network of 702 branches, 1727 ATMs and 5822 staff in Q1FY2022.
Book value of the bank stood at Rs 81.4
per share at end June 2021, while the adjusted book value (net of NNPA and 10%
of restructured advances) was Rs 61.9 per share at end June 2021.
Quarterly
Performance
NII growth is subdued: Bank has
recorded 5% decline in the interest earned at Rs 997.43 crore, while interest
expenses declined 10% to Rs 549.83 crore in Q1FY2022. NII improved 2% to Rs 447.60
crore in the quarter ended June 2021.
Healthy growth in non-interest income: The
overall non-interest income increased 22% to Rs 195.65 crore in the quarter
ended June 2021. The bank has posted strong 49% surge in the fee income to Rs 68
crore, while the treasury income has declined to Rs 105 crore from Rs 108.5
crore a year ago. Other income including recoveries in written off account has surged
245% to Rs 22.4 crore.
Stable expenses ratio: The
operating expenses of the bank increased 8% to Rs 260.23 crore, as other
expenses moved up 5% to Rs 130.97 crore, while employee expenses increased 11% to
Rs 129.26 crore in Q1FY2022. Cost to income ratio was nearly stable at 40.5% in
Q1FY2022 compared with 40.4% in Q1FY2021, helping the Operating Profit to
increase 8% to Rs 383.02 crore.
Provisions and contingencies rises: The bank
has showed 8% rise in provisions to Rs 170.03 crore.
Effective
tax rate declined to 18.8% in Q1FY2022 from 22.6% in Q1FY2021. Net Profit rose
by 12% YoY to Rs 173.00 crore
Financial
Performance FY2021:
City Union Bank Interest income has declined 0.81% to Rs
4,134.68 crore in FY2021. Interest expense fell 7.56% to Rs 2,305.02 crore. Hence
net interest income rose 9.22% to Rs 1,829.66 crore.
With
other income showing a rise of 3.65% to Rs 704.77 crore, net total income
increased 7.61% Rs 2,534.43 crore. Operating expenses rose 3.64% to Rs 1050.59
crore. As a result, profit before provisions rose 10.62% to Rs 1483.84 crore. Provisions
& Contingencies increased 4.76% to Rs 791.02 crore, leading to Profit
before tax reported profit of Rs 692.82 crore compared to Profit of Rs 586.32
crore.
There were
no extraordinary items. PBT after EO reported profit of Rs 692.82 crore
compared to Profit of Rs 586.32 crore. Provision for tax was expense of Rs 100
crore, compared to Rs 110 crore. Net profit rose 24.46% to Rs 592.82 crore.
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City Union Bank: Results
|
|
Particulars
|
2106
(3)
|
2006
(3)
|
Var %
|
2103
(12)
|
2003
(12)
|
Var %
|
|
Interest Earned
|
997.43
|
1049.36
|
-5
|
4134.68
|
4168.60
|
-1
|
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Interest Expended
|
549.83
|
612.40
|
-10
|
2305.02
|
2493.41
|
-8
|
|
Net Interest Income
|
447.60
|
436.96
|
2
|
1829.66
|
1675.19
|
9
|
|
Other Income
|
195.65
|
160.59
|
22
|
704.77
|
679.95
|
4
|
|
Net Total Income
|
643.25
|
597.55
|
8
|
2534.43
|
2355.14
|
8
|
|
Operating Expenses
|
260.23
|
241.51
|
8
|
1050.59
|
1013.74
|
4
|
|
Operating Profits
|
383.02
|
356.04
|
8
|
1483.84
|
1341.40
|
11
|
|
Provisions & Contingencies
|
170.03
|
157.00
|
8
|
791.02
|
755.08
|
5
|
|
Profit Before Tax
|
212.99
|
199.04
|
7
|
692.82
|
586.32
|
18
|
|
Provisions for Tax
|
40.00
|
45.00
|
-11
|
100.00
|
110.00
|
-9
|
|
Net Profit
|
173.00
|
154.05
|
12
|
592.82
|
476.32
|
24
|
|
EPS*(Rs)
|
9.4
|
8.3
|
|
8.0
|
6.5
|
|
|
* Annualized on current equity of Rs 73.84 crore. Face Value: Rs
1, Figures in Rs crore,
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|
LP : Loss to profit ; PL : Profit to loss
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Source: Capitaline Corporate Database
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