Union Bank of India , one of India's leading public sector banks, has reported a 3.24% year-over-year growth in total business for the quarter ended September 30. This growth comes alongside improvements in asset quality and advancements in key financial metrics.

Business Growth and Advances

The bank's gross advances increased by 4.99% year-over-year, reflecting a robust expansion in its lending portfolio. This growth in advances has contributed significantly to the overall business growth of the bank.

Deposit Growth

Total deposits grew by 1.90% year-over-year, indicating a steady inflow of funds from customers. While the deposit growth is modest, it demonstrates the bank's ability to maintain and slightly expand its deposit base in a competitive banking environment.

Improved Asset Quality

A notable highlight of the bank's performance is the improvement in asset quality. The gross non-performing assets (NPA) ratio dropped to 3.29%, marking a significant improvement in the bank's loan portfolio quality. This reduction in NPAs suggests enhanced risk management practices and improved recovery efforts by the bank.

Financial Performance

The bank's financial results for the quarter reveal several key indicators:

While the operating profit and net profit show a year-over-year decline, the bank has maintained profitability in the current economic environment.

Capital Adequacy and Liquidity

Union Bank of India maintains a strong capital position with a Capital Adequacy Ratio (CAR) of 17.07% under Basel III norms, well above the regulatory requirements. The Common Equity Tier 1 (CET1) ratio stands at 14.37%, indicating a robust core capital base.

Outlook

The bank's performance this quarter, characterized by business growth and improved asset quality, positions it well for future growth. The reduction in NPAs is particularly encouraging, as it may lead to lower provisioning requirements and potentially higher profitability in upcoming quarters.

Union Bank of India's focus on expanding its advance portfolio while simultaneously improving asset quality demonstrates a balanced approach to growth and risk management. As the bank continues to navigate the evolving economic landscape, its strong capital position and improving asset quality provide a solid foundation for sustainable growth.

Union Bank of India , one of India's leading public sector banks, has announced its quarterly results for the period ended September 30, showcasing significant improvements in various financial metrics.

Financial Performance

The bank reported a net profit of ₹4,720.00 crores, a slight increase from ₹4,604.00 crores in the same quarter of the previous year. This growth comes despite a compression in Net Interest Margin to 2.67% from 2.90%. The bank's Net Interest Income grew to ₹8,812.00 crores.

Credit Growth and Asset Quality

Union Bank of India achieved an impressive 8.14% year-over-year growth in RAM (Retail, Agriculture, MSME) advances, reaching ₹5.54 lakh crores. The bank's asset quality showed significant improvement:

The substantial reduction in both Gross and Net NPAs indicates the bank's effective management of non-performing assets.

Capital Adequacy and Profitability

The bank maintained a strong capital position with a Capital Adequacy Ratio of 17.07%, including a CET-1 ratio of 14.37%. Profitability metrics also showed improvement:

• Return on Assets: 1.16%
• Return on Equity: 15.08%

Notably, the credit cost decreased substantially to 0.22% from 1.09% in the same quarter last year, reflecting improved risk management practices.

Deposit Base and CASA Ratio

Union Bank of India's deposit base reached ₹12.35 trillion, with a CASA (Current Account Savings Account) ratio of 32.56%, indicating a healthy mix of low-cost deposits.

Digital Transformation and Inclusive Banking

The bank continued its focus on digital transformation initiatives, aiming to enhance customer experience and operational efficiency. Additionally, Union Bank of India maintained its commitment to inclusive banking through various government schemes, supporting financial inclusion efforts.

Conclusion

Union Bank of India's Q2 results demonstrate strong performance across key areas. The significant credit growth in the RAM sector, improved asset quality, and enhanced profitability metrics position the bank well for sustained growth. The focus on digital transformation and inclusive banking further underscores the bank's commitment to modernization and social responsibility in the banking sector.