Union Bank Q4: Net Profit Rises 93.3 Per Cent To Rs 2,782 Crore, Board Recommends Dividend Of Rs 3 Per Share

For the whole of the financial year 2022-23, the bank's net profit grew 61.18 per cent to Rs 8,433 crore against Rs 5,232 crore in FY22.

The massive jump in profit is backed by healthy growth in Net Interest Income (NII) and non-interest income.

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Public sector lender Union Bank of India reported a 93.27 per cent rise in standalone net profit for the quarter ending in March. The net profit stood at Rs. 2,782 crore, compared to Rs. 1,440 crore during the same period in the previous year. On a sequential basis, the profit rose 23.95 per cent compared to Rs 2,244 crore net profit in Q3 of FY23. The massive jump in profit is backed by healthy growth in Net Interest Income (NII) and non-interest income.

For the whole of the financial year 2022-23, the bank's net profit grew 61.18 per cent to Rs 8,433 crore against Rs 5,232 crore in FY22.

The board of directors has recommended a dividend of Rs 3.0 per share (Rs 10 each) for FY23, subject to shareholders' approval, according to the bank's exchange filing. 

The state-owned bank reported a growth of 21.88 per cent in net interest income (NII) for the quarter, amounting to Rs 8,251 crore. The bank's low-cost current account savings account (CASA) deposit, which is the cheapest source of funds, increased by 4.47 per cent year over year, bringing the total deposit base to Rs 11,17,716 crores as of March 31, 2023.

Its capital adequacy ratio stood at 16.04 per cent with a Common Equity Tier of 12.36 per cent at the end of March.

Additionally, Union Bank of India reported an improvement in asset quality, with Gross NPA as a percentage of total advances reducing by 358 bps on a year-over-year basis to 7.53 per cent, while Net NPA reduced by 198 bps on a year-over-year basis to 1.70 per cent.

Total business for the bank increased by 10.23 per cent year-over-year, with gross advances increasing by 13.05 per cent year-over-year and total deposits growing by 8.26 per cent year-over-year, resulting in a total business of Rs. 19,27,621 crore as of March 31, 2023.

The bank has guided for a 10-12 per cent growth in advances for March 2024, which is similar to FY23, and an 8-10 per cent deposit growth. The company plans to maintain its net interest margin at 3 per cent and bring Gross NPA to less than 6 per cent, with an expected slippage of about Rs. 12,000 crore and gross recovery of Rs. 16,000 crore.