City Union Bank Posts 10% Increase in Q1 Net Profit

Chennai: City Union Bank today reported a 10.1 per cent increase in its net profit for the first quarter at Rs 99.49 crore.

The Tamil Nadu-based private sector bank had reported net profit of Rs 90.29 crore during the corresponding period a year ago.

"Total income of the bank for the quarter rose to Rs 754.03 crore from Rs 702.88 crore in Q1 of last year", City Union Bank's managing director and CEO N Kamakodi told reporters here.

He said the net profit has grown by 10.1 per cent for the quarter and expected that the bank's growth to be on similar lines during rest of the current financial year.

"Last couple of years have been difficult for the entire banking industry in terms of growth and asset quality. Since we did not focus on infrastructure and consortium, we were reasonably okay in our asset qualities. So ultimately our profit after tax has grown by 10.1 per cent for the quarter," he said.

"Going forward, we are hopeful of achieving 10-12 per cent growth. That growth will happen at the end of the fourth quarter," he said.

Noting that the net NPAs of the bank increased to 1.28 per cent in the Q1 of FY15 as against 0.63 per cent in the corresponding period last year, he said there was a slippage of about Rs 317 crore during the quarter.

He also informed that their fund raising through QIP issue has been completed this year.

"The issue was to raise Rs 350 crore and it got oversubscribed by 3.38 times aggregating to Rs 1,181.39 crore," he said.

"Now do not need immediate capital. Second tranche may happen after a year...," he said.

On expansion plans, he said the bank had opened one branch during the quarter ending June 30, 2014 and by this year end it plans to open 500 branches in the country.