Mumbai, State-owned Union Bank of India on Wednesday reported a 27.5 percent dive in its combined net revenue to Rs 5,641.52 crore for the June quarter of the existing financial on the back of much better margins, enhanced property quality and greater interest earnings.
In the year-ago duration, the bank’s net earnings stood at Rs 4,427.94 crore, according to a regulative filing.
The bank’s net interest earnings (NII) edged up by 1.05 percent year-on-year to Rs 27,203 crore in the reporting quarter, from Rs 26,919 crore, restricted by the net interest margin (NIM).
The NIM partially advanced by 0.04 percent year-on-year and 0.16 percent on a consecutive basis to 2.80 percent in Q1FY27.
Asheesh Pandey, MD and CEO of Union Bank of India, revealed self-confidence that margins can be enhanced even more regardless of the developing interest-rate environment.
Under the unique FCNR-B window presented by the Reserve Bank of India (RBI), Pandey anticipates around 1.5-2 billion inflows by September. He included that the bank has actually up until now amassed USD 106 million in deposits.
“We have mobilised around USD 106 million under FCNR-B deposits so far. Our target is to raise USD 1.5-2 billion by September,” Pandey stated throughout the post-earnings conference.
He included that deposits have actually been amassed from a number of areas, consisting of Australia and the UAE.
“Deposits have come from several locations, including Australia and the UAE. We have five dedicated NRI branches and have identified another 20 branches with a large NRI customer base to run a focused mobilisation campaign. We have also set up an NRI cell to contact customers individually instead of relying only on SMS campaigns,” he stated.
The bank is presently providing rates of interest of around 6.10-6.60 percent and is comfy with these rates, Pandey stated.
“Initially, customers needed time to understand the scheme. Subsequently, the RBI FAQs clarified many queries. FCNR-B mobilisation also requires direct engagement with NRIs, who compare deposit rates before investing.
“The existing reaction has actually been motivating, and there is a healthy pipeline,” Pandey said.
The central bank introduced the special FCNR-B window during the June monetary policy committee (MPC) meeting, including bearing the cost of currency hedging, to increase foreign capital inflows and bolster India’s external position.
In the quarter under review, global deposits of the bank rose by 3.50 per cent to Rs 12.83 lakh crore, compared to Rs 12.39 lakh crore in the year-ago period. Domestic deposits increased by 3.49 per cent to 12.83 lakh crore in Q1FY27.
The low-cost, current account and savings account (CASA) deposits increased 11.73 per cent YoY to 4.50 lakh crore.
CASA ratio improved to 35.09 per cent in the reporting quarter, from 32.51 per cent in Q1FY26.
Gross advances of the bank also rose 12.50 per cent YoY to Rs 10.96 lakh crore in Q1FY27, from Rs 9.74 lakh crore in the corresponding period a year ago. The bank’s Retail, Agri and MSME (RAM) advances increased 11.56 per cent YoY to Rs 6.08 lakh crore.
In the reporting quarter, the asset quality of the bank improved, with gross non-performing assets (NPAs) falling by 0.87 per cent to 2.65 per cent as on June 30.
Shares of Union Bank of India closed 1.08 per cent higher at Rs 172.4 apiece on the BSE on Wednesday.
