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Analyst Meet / AGM - Analyst Meet

Targets advances growth of 10-11% for FY2016

Union Bank of India

13-May-2015, 12:42
Union Bank of India conducted the analyst meet on 12 May 2015 to discuss financial performance for the quarter ended March 2015 and the prospects of the bank. Arun Tiwari, Chairman and Managing Director of the Bank addressed the meet:
Highlights:

Bank has exhibited performance in line with the given guidance.

Fresh slippages of advances to the NPA category eased to Rs 1547 crore in Q4FY2015, of which the largest account had exposure of Rs 180 crore. Bank expects fresh slippages to continue to ease going forward.

Bank sold Rs 339 crore of NPAs in Q4FY2015 and Rs 769 crore in FY2015 to the Asset Reconstruction Companies (ARCs).

Bank has conducted fresh restructuring of Rs 2368 crore in the quarter ended March 2015. One account from the ports sector restructured in Q4FY2015 had highest exposure of Rs 850 crore.

Bank has restructuring pipeline of Rs 1300 crore, which is cleared ahead of regulatory dispensation ending beyond March 2015.

On liabilities front, bank proposes to focus mainly on saving accounts. Bank targets to improve CASA ratio to 32% in FY2016.

Bank has offloaded about Rs 18000 crore high cost deposits in FY2016. Share of High cost deposits declined to 5.8% from 12.6% in FY2015.

Bank has improved the size of Retail, Agriculture, MSME (RAM) loan book to 49% in FY2015 from 44% in FY2014.

Bank targets the advances growth of 10-11% for FY2016, with the focus on RAM book.

Bank proposes to improve NIM to 2.6-2.75% in FY2016.

Bank proposes to reduce the GNPA ratio to 4.5-4.75% by end march 2016.

Banks expects deposits growth at 6-7% in FY2016.

As a result of IT investments incurred ahead of the curve, banks transaction turnaround time has become faster and is cost-efficient. Bank proposes to improve the e-transaction rate to 62% in FY2016.

Bank has raised the ATM-branch ratio to 1.72 at end March 2015 from 1.5 at end March 2014.

Liquidity coverage ratio (LCR) for quarter ended March 2015 was higher at 111.7% compared to regulatory minimum requirement of 60%.