UCO Bank on Tuesday reported a 110 per cent jump in profit at Rs 653 crore in the quarter ended December 2022, driven by increase in interest income and decline in bad loans.
The bank hopes to maintain the growth momentum in the fourth quarter of FY23.
Its net profit stood at Rs 310 crore in the same quarter of the preceding financial year.
"We expect business growth of advances and deposits in the fourth quarter will continue to be robust. Advances had grown 20.5 per cent during the quarter. With revision of rates, healthy growth in deposits is expected," UCO Bank MD & CEO Soma Sankara Prasad said.
Speaking about net interest margin, the executive said there is a continuous increase in each quarter and going forward NIM should be between 3 and 3.01 per cent.
"Recovery is higher than fresh slippages. Now our average quarterly slippages had reduced to Rs 500 crore from Rs 1,500 crore in the past. In this quarter write back from written off accounts was Rs 458 crore," Prasad said.
On the asset quality front, the bank recorded an improvement with gross NPAs (Non-Performing Assets) declining to 5.63 per cent of gross advances as compared to 8 per cent at the end of the third quarter of 2021-22.
Net NPAs too eased to 1.66 per cent from 2.81 per cent in the same quarter a year ago.
As a result, provisions for bad loans declined significantly to Rs 220 crore from Rs 565 crore in the same period a year ago.
Total income increased to Rs 5,451 crore in the quarter from Rs 4,638 crore in the year-ago period, the bank said in a regulatory filing.
Interest income rose to Rs 4,627 crore as compared to Rs 3,919 crore in the same quarter a year ago.
However, the capital adequacy ratio declined to 14.32 per cent in the December quarter as against 14.56 per cent.
During the quarter under review, the Reserve Bank imposed a penalty of Rs 88 lakh, the lender said.
