United Bank Of India Puts Up Strong FY14 Numbers

Net interest income (NII) of United Bank of India (UBI), has recorded a good double digit growth of 24% yoy and stood at Rs 698.4 crore in Q4FY14 against Rs 563.8 crore in Q4FY13.

Operating profit for the bank increased by 6.3% to Rs 542.9 crore in Q4FY14 as compared to Rs 510.7 crore in same quarter of the last year. The growth in operating profit was low as compared with NII mainly due to decease in other income of the bank by 11.2% in the said quarter to Rs 311.7 crore. More over net profit of the bank shoot up by 167% yoy to Rs 83.1 crore in Q4FY14 from Rs 31.2 crore in same period last year as the bank reduced its provision by 59.2% QoQ to Rs. 267 crore in the said quarter from Rs.1857.8 crore in Q3FY14.

Total interest for the bank recorded a considerable growth of 18.2% yoy to Rs 2764 crore in Q4FY14 against Rs 2336 crore during Q4FY14 which was mainly driven by retail banking segment and treasury segment of the bank. Retail banking segment which account for 28% of total income grew by 47% yoy to Rs 859.6 crore in Q4FY14 where it was Rs 584.2 in Q4FY13. The treasury segment which also stands for 28% of total income went up by 12.3% to Rs 863.2 crore in said quarter. 

The bank has also showed marginal improvement in its assets quality during the said quarter. Its gross non-performing assets (NPAs) during the quarter stood at 10.47% of total lending in Q4FY14 where it was 10.82% in Q3FY14. While net NPAs came down to 7.18% in Q4FY14 from 7.44% in Q4FY13.

As far as its whole year performance is concernd, the bank recorded a marginal yearly growth of 3% during FY’14 in NII to Rs 2562.8 crore against Rs 2487.5 crore in FY'13 while its operating profit remained flat for the said year at Rs 2061.7. But net profit stood at Rs 1213.5 crore in FY'14 against Rs 392 crore in FY'13 with a fall of 410% mainly due to increases in provision by 106% to Rs 3618 in the said year. 

At CMP of Rs 34.75, the bank is trading at 0.26x of its book value.