Union Bank net rises 36%

Mumbai: Union Bank of India has posted over 36-per cent increase in its net profit for the quarter ended 30 June 2003, at Rs 155.88 crore, up from Rs 113.91 crore in the corresponding period of the previous year.

The total income rose to Rs 1,277.66 crore from Rs 1,185.92 crore while the net interest margin was maintained at 3.44 per cent (3.43 per cent). There has been a substantial lowering in the cost of deposits to 6.23 per cent from 7.01 per cent in the first quarter of 2002.

"The bank is targeting an operating profit of Rs 1,700 crore for the current year, which is a 31-per cent increase; as of now we are on target," says Union Bank of India chairman and managing director V Leeladhar.

"We see 30-per cent incremental growth in retail advances this year and the retail should constitute 22 per cent of our balance sheet by the year end," he adds. At present retail advances at Rs 5,169 crore constitute close to 20 per cent of the total advances, which stand at Rs 26,099 crore.

With no demand for corporate or wholesale credit, the bank has seen its advances shrink quarter-on-quarter, to Rs 26,099 crore from Rs 26,649 crore.