Monday, March 1

United Bank of India hopes to turn around in March quarter despite current losses

KOLKATA: United Bank of India management expressed hope of turning around in the March next quarter even as the state-owned lender’s net loss widened to Rs 1139 crore in the December quarter due to high provisioning.

This was the bank’s seventh consecutive quarterly loss as sticky assets continued to strain the balance sheet. Net loss was Rs 638 crore in the year ago period while it was Rs 883 crore in the preceding quarter.

It has however more than doubled its operating profit at Rs 383 crore for the period under review. The bank attributed the net loss to the nearly 100% rise in provision to cover bad loans and other contingencies at Rs 1967 crore.

Its NPA ratios remain elevated with the gross ratio being at 21.27% at the end of December 2018, as against 22.69% a quarter back. Net NPA ratio was at 12.08% (14.36%).

“We are hopeful lhat the bank will turn around and report profit the fourth quarter. We will ensure that the same is sustained and consistent,” UBI Managing Director Ashok Kumar Pradhan said.

The bank expects to get out of Prompt Corrective Action framework by September quarter in 2019. “PCA has impacted the bank in many ways including taking away the opportunity from to book profit on trading activity in the light of softening of yield regime. While the entire banking world was booking trading profit, lifting of the same would enable the bank to pursue its business objectives more naturally and spontaneously,” Pradhan said.

UBI’s tolal business closed at Rs 1 98 lakh crore at the end of review period.

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