Q4 Results: Union Bank’s Loss Widens As RBI Finds Rs 2,200-Crore Divergence
Union Bank of India’s loss for the three months ended March 2019 widened after the state-run lender reported a Rs 2,200-crore divergence.
Net loss stood at Rs 3,369.2 crore in the March-ended quarter compared to a loss of Rs 2,583.4 crore in the corresponding quarter last year, according to the public sector bank’s exchange filing. Analysts tracked by Bloomberg were expecting a Rs 102-crore profit instead.
The change in the bottom line was primarily due to higher-than-expected provisions as the government-owned bank had to make up for the Rs 2,200-crore divergence pointed out by the Reserve Bank of India. A divergence is the difference in classification of assets as stressed or standard accounts, as seen by the banking regulator and the bank.
- Net interest income up 18.6 percent at Rs 2,601.5 crore, year-on-year
- Provisions up 3 percent at Rs 5,783.1 crore, year-on-year
- GNPA at 14.98 percent versus 15.66 percent, quarter-on-quarter
- NNPA at 6.85 percent versus 8.27 percent, quarter-on-quarter
Slippages during the quarter stood at Rs 3,275 crore compared to Rs 2,983 crore in the December-ended quarter.
“Union Bank does not see any stress from the cash-strapped non-banking financial companies sector,” Rajkiran Rai G, managing director and chief executive officer of the bank told BloombergQuint.
“There are very, very few accounts that are being downgraded. Those accounts have been adequately provisioned for or will be provisioned for,” he said, adding that all other accounts are doing well.
Watch the full interview here: