State-run UCO Bank on Thursday reported a practically 5-fold year-on-year jump in its net profit to Rs 80.03 crore for the fourth quarter of FY21, from Rs 16.78 crore in the very same period earlier fiscal, as its operating profit grew 26% y-o-y.
The lender, which is nevertheless below the Reserve Bank of India’s Prompt Corrective Action framework, showed important improvement in its asset high-quality throughout Q4 as its NPAs in absolute terms fell 41% y-o-y to Rs 1,1351.97 crore. The NPA ratio stood at 9.59%, which was 718 basis points down y-o-y. The gross NPA ratio decreased 21 bps on a quarter-on-quarter basis from 9.80%.
The bank, in a stock exchange filing, informed that its board of directors authorized the proposal for raising of equity capital aggregating to Rs 3,000 crore by way of a variety of modes such as FPO, QIP and preferential problem, topic to required regulatory approvals. The capital adequacy ratio stood at 13.74% (below Basel III), with the popular equity tier-I ratio at 11.14% as on March 31.
Talking to FE, MD & CEO AK Goel attributed the sharp rise in the net profit to important rise in operating profit, interest revenue and non-interest revenue.
Operating profit stood at Rs 1,532.54 crore, against Rs 1,216.60 crore for the very same period a year ago. Net interest revenue rose 12.6% y-o-y to Rs 1,412.60 crore, whilst non-interest revenue saw an more than 78% y-o-y development to Rs 1,370.43 crore.
Total advances stood at Rs 118,404.81 crore as on March 31, 2021, against Rs 114,961.44 crore as on March 31, 2020, registering a development of 3%. At the finish of Q4FY21, net interest margin stood at 2.70, 12 bps up from 2.58% in very same period of FY20.
The provision coverage ratio enhanced to 88.40% as on March 31, from 85.46% in the year-ago period. The provision for NPAs declined by 29.33% y-o-y at Rs 769.81 crore, against Rs 1,089.26 crore throughout Q4FY20.
During Q4, the lender’s fresh slippages stood at about Rs 2,449 crore. “Fresh slippages came primarily from retail, agriculture, MSME and large corporate,” Goel stated.