UCO Bank reports Rs 30-crore net profit in Q2, brings down bad loans

Topics UCO Bank | Banking sector

The bank had posted a net loss of Rs 891.98 crore during the corresponding quarter of the previous financial year.

State-owned UCO Bank on Thursday reported a net profit of Rs 30.12 crore for the second quarter ended September 30.

The bank had posted a net loss of Rs 891.98 crore during the corresponding quarter of the previous financial year.

Sequentially, the profit during the second quarter of 2020-21 was higher from Rs 21.46 crore in the first quarter ended June 2020.

Its total income was down at Rs 4,326.14 crore during the September 2020 quarter, from Rs 4,533.51 crore a year ago, UCO Bank said in a regulatory filing.

Interest income fell to Rs 3,614.61 crore during the quarter, compared with Rs 3,804.64 crore in the year-ago period.

The bank improved on its asset quality significantly by bringing down the gross non-performing assets (NPAs) to 11.62 per cent of the gross advances as on September 30, 2020, from 21.87 per cent as of September 2019.

In absolute value, the gross NPAs were down at Rs 13,365.74 crore as against Rs 25,665.14 crore.

Similarly, the net NPAs decreased to 3.63 per cent (Rs 3,831.88 crore) as against 7.32 per cent (Rs 7,238.33 crore).

Provisioning for bad loans also fell to Rs 1,032.14 crore, from Rs 2,034.07 crore a year ago.

The overall provisioning for bad loans and contingencies stood at Rs 1,300.20 crore, down from Rs 2,099.02 crore a year ago.

UCO Bank also said that as per a Supreme Court order and necessary guidelines issued by the Reserve Bank of India (RBI), it has kept Delhi Airport Metro Express Pvt Ltd as a standard account.

However, necessary provision of Rs 77.54 crore has been held by the bank against the amount of Rs 194.14 crore which has not been treated as NPA as per required norms.

"As per RBI guidelines issued during the financial year ended March 31, 2018, in respect of select borrowers accounts covered under provisions of the Insolvency and Bankruptcy Code (IBC), against total outstanding of Rs 762.49 crore, the bank is holding a provision of Rs 735.41 crore as on September 30, 2020," UCO Bank said.

The non-performing loan provisioning coverage ratio stood at 89.82 per cent as on September 30, 2020.

Shares of UCO Bank on Thursday was trading at Rs 12.71 apiece on the BSE, up 0.87 per cent from the previous close.

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