UCO Bank Q2 net plunges due to higher provisioning

UCO Bank Chairman and Managing Director attributed the steep fall in profit to higher provisioning

State-run UCO Bank today reported a 74% plunge in net profit to Rs 103 crore for the second quarter of the current fiscal due to higher provisioning for bad loans.

The bank's profit in the comparable period of the previous fiscal stood at Rs 400.2 crore.

UCO Bank Chairman and Managing Director Arun Kaul attributed the steep fall in profit to higher provisioning.

Total income in the quarter under review increased 12.97% to Rs 5,257 crore, while total interest income showed a growth of 10.21% at Rs 4,898 crore, he told reporters here today.

As on September 30, 2014, gross NPA ratio of the bank stood at 5.20% (5.32%) of total advances, while net NPA at 3.15% (3.13%).

Kaul said slippages in assets belonging to the infrastructure sector were the main reason for fresh NPAs of Rs 2,100 crore during the quarter.

He said domestic credit offtake was low as AAA rated corporates and CPSUs were sourcing cheap funds from outside sources and not coming to the bank.

UCO bank, Kaul said, was expecting good recovery from old NPAs during the current quarter.

Net Interest Margin (NIM) of the bank during the quarter stood at 2.60% (3.10%).

Total business of the bank at the end of second quarter stood at Rs 3,46,716 crore.