UCO Bank net loss widens by 50% in Q1

State-run lender UCO Bank on Wednesday reported a net loss of Rs 663.02 crore in the quarter ended June 30, 2017, widening by over 50 per cent from Rs 440.56 crore in the year-ago period.

The loss was attributed to higher provisioning for bad loans and dip in income.

The provisions for non-performing assets (NPAs) were at Rs 1,204.25 crore during the quarter under review, up by 28 per cent from Rs 942.73 crore in corresponding period last year.

Provisions and contingencies increased marginally by 1.7 per cent over last year to Rs 1,272.10 crore from Rs 1,250.50 crore in the corresponding period last year.

The bank's asset quality worsened further in the June quarter as its gross NPAs, in absolute terms, at Rs 25,054.21 crore rose by close to 11 per cent over last years' Rs 22,597.70 crore in the same quarter last year.

During the period under review, the public sector bank's total income saw a 10.4 per cent dip at Rs 4,237.04 crore as against Rs 4,727.93 crore in the year-ago period.

In the January-March quarter of last fiscal, the city-based lender had posted a net loss of Rs 582.08 crore. In May, the Reserve Bank of India initiated prompt corrective action (PCA) for the bank in view of high non-performing assets and negative return on assets.

As per the revised prompt corrective action framework for banks, the lender, which had posted net losses for two consecutive years, was under "Risk Threshold 1" of the PCA matrix, where it had restrictions on branch expansion plans, dividend distribution and staff expansion, among others.

It reported negative returns on assets (RoAs) for two consecutive years, with net non-performing advances (NNPA) ratio standing at 8.94 per cent as on March 31.A

Even after initiation of PCA, the banks' NNPA ratio further increased at 10.63 per cent as on June 30.

--IANS

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