State-run lender United Bank of India has reported net loss for the fifth consecutive quarter even as it managed to restrict fresh generation of sticky loans by two-third.
The bank said its loss for the quarter to June was Rs 389 crore compared with Rs 212 crore loss in the year ago period, on account of high sticky loans and spike in mark-to-market treasury losses.
The ratio of gross non-performing assets slipped to 22.73% from 17.17% a year back, raising the provisioning requirement 13% to Rs 856 crore.
It has also provided Rs 252 crore towards mark-to-market treasury losses in the June quarter. Its operating profit fell 33% at Rs 282 crore over Rs 243 crore in the year ago quarter due to fall in treasury income which offset the doubling of net interest income.
Nonetheless, UBI has shown improvement in asset quality sequentially. Gross NPA ratio improved 137 bps from 24.1% at the end of March. This helped the lender, which has been under Reserve Bank of India’s prompt corrective action mechanism, cut losses in the June quarter compared to March quarter’s loss of Rs 413 crore.
The bank said it will continue its thrust on containing of fresh slippages and NPA reduction through resolution of large NPA accounts. It managed to restrict fresh slippage to Rs 547 crore in June quarter against Rs 1669 crore generation in the year ago period.
It has created a stressed asset management vertical under the finance ministry’s direction
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