Ubi Posts Rs 61 Crore Operating Profit In Q1

Public sector United Bank of India (UBI), which was considered a weak till sometime back, has registered a Rs 61 crore operating profit in the first quarter (Q1) of 2002-03 against Rs 7 crore in the corresponding period last year.

Incremental credit offtake at the bank was close to Rs 100 crore, said Madhukar, chairman and managing, director at the sidelines of a meeting with the members of the Bengal National Chamber of Commerce and Industry on 'finance to industry and services'. Low cost savings growth at UBI has registered a 4-5 per cent growth in the same period.

Madhukar said UBI was looking at a 50 basis point cut in its prime lending rate (PLR) which stands at 12 per cent now.

 

"But the cut will only be effected after we have studied the market trend which should be clear in a month," said the chairman. "A cut in PLR will also be followed by a cut in deposit rates," he added.

On disbursals, UBI was also planning to enter the film financing sector and will have a corpus of Rs 50 crore to Rs 100 crore to begin with. UBI was also not averse to the idea to joint financing with other banks in case the project was large.

The chairman has also launched several new products. One such product provides for incentive in terms of reduced interest rates or extended repayment period if a company practices prudent accounting and management policies.

This scheme, christened United Performance Account, will provide incentive points for continuous improved performance, timely filing of balance sheets, and so on which will allow account holders' to earn points on the basis of which they will be able to get increased limit or reduced interest rates.

Next in the pipeline is a mortgage linked financing product that will be disbursed on the basis of value of the property.

The bank is also offering lower interest rates to companies that are using agricultural products from the state as inputs and have a decent balance-sheet.

On disbursements, the bank has provided standing instruction to all its branches not to cancel loan proposal for project - if the loan amount asked for is too high, it has to be directly passed on to the headoffice where it will be decided, thus doing away with all the intermediary steps that generally delay loan disbursal.

On information technology front, the bank will network 40 branches in four metros by September. This will be followed by networking all its 100 branches metros as well as cities like Hyderabad, Bangalore, Patna, Lucknow and Jaipur. This will be followed by a launch of a debit card and a credit card as well.