Ujjivan SFB's Q3 net loss narrows to Rs 34 cr on lower provisions

Ujjivan Small Finance Bank (SFB) trimmed its net losses significantly to Rs 34 crore in the quarter ended in December 2021 on the back of lower provisioning, increasing collection efficiency and highest-ever loan disbursals.

The bank had posted a net loss of Rs 279 crore in the corresponding quarter a year ago.

Total income of the bank rose by 2 per cent to Rs 799 crore in the third quarter of FY22 compared to Rs 786 crore in the year-ago period, with a 3 per cent growth in interest income to Rs 708 crore.

However, other income of the bank fell by 9 per cent to Rs 91 crore in three months to December 2021.

The SFB parked aside a lower amount as provisioning and contingencies requirement for the quarter at Rs 187 crore against Rs 581 crore in the year-ago period.

However, asset quality of the bank deteriorated on an annual basis with the gross non-performing assets (NPAs) spiking to 9.79 per cent of the gross advances at end of December 31, 2021, as against 0.96 per cent by the end of December 2020. But gross NPSs improved sequentially from 11.80 per cent by end of September 2021.

Likewise, the net NPAs of the bank touched 1.67 per cent of the net advances, up from 0.05 per cent a year ago, but down from 3.29 per cent by September 2021 quarter.

Ujjivan SFB said Q32021-22 witnessed the highest ever quarterly disbursements at Rs 4,809 crore, up by 120 per cent year-on-year and 54 per cent on a quarterly basis.

Collection efficiency stood at 97 per cent in December'21, reaching pre-Covid levels, excluding gross NPAs, it was 99 per cent.

The lender said it has strengthened its retail franchise with retail deposits growing by 50 per cent, CASA (current account savings account) up by 100 per cent. Total deposits rose by 34 per cent to Rs 15,563 crore and it added 2.1 lakh new customers during Q3FY22.

Bank's efforts have yielded results in improving the performance, Ittira Davis, MD&CEO, Ujjivan SFB said.

"Last couple of months have been challenging due to internal and external issues, despite that we focussed on business and streamlined processes which lead to improved portfolio quality, higher business volumes and reduced attrition, in-line with our 100-day plan.

"We continue to attract good talent and over last few months have strengthened the leadership team further; our CIO and Head Digital Banking have already joined while CFO and Head Internal audit are joining in coming months," he said.