Public sector United Bank of India has reported a net loss of Rs 637.53 crore during third quarter ended December 2017 on dip in investment income and a substantial rise in NPA provisioning.
During same period of previous fiscal, the bank had registered a net profit of Rs 64.10 crore.
"Owing to a drop in trading profit (nearly Rs 375 crore), growth in depreciation on investments (428 per cent) on account on unfavourable market conditions and spike in NPA provisioning by about 95 per cent (Rs 470 crore) during the period, the overall profitability has been adversely affected," the bank said in a statement.
Total income of the bank also fell to Rs 2,483.01 crore during the October-December period of 2017-18 from Rs 3,086.06 crore in the same period of 2016-17.
Net interest income was down for the quarter at Rs 347.94 crore, as against Rs 360.98 crore.
Asset quality of the bank worsened with gross non- performing assets (NPAs) hitting 20.10 per cent (Rs 13720.69 crore) of the gross advances as on December 31, 2017 against 15.98 per cent (Rs 10,845.31 crore).
Net NPAs or bad loans too spiked to 11.96 per cent (Rs 7,365.14 crore) from 10.62 per cent (Rs 6,729.89 crore).
A higher NPA ratio required the bank to keep aside Rs 964.07 crore as provision for the quarter, against Rs 494.52 crore it has kept aside for year ago third quarter.
In all, it has to make Rs 394.13 crore of additional provisioning, of which Rs 262.75 crore is to be provided for during 2017-18.
Bank's total deposits remained almost flat at Rs 12,5579 crore, however, savings deposits increased by Rs 220 crore from a year ago.
Advances were up at Rs 68,250 crore in third quarter this fiscal from Rs 67,866 crore.
"The advance portfolio has expanded by about Rs 384 crore mainly due to growth in MSME advance by 17.70 per cent and growth in housing loan and car loan segment by 23.63 per cent and 31.31 per cent, respectively.