City Union Bank (CUB) Q4 17/18 earnings summary

Executive summary

• FY18 business grew 13% to ₹61,092 crore; net profit rose 18% to ₹592 crore, while gross NPA increased to 3.03%.

• Deposits grew 9% and gross advances 17%; NIM was 4.42%, with stronger recoveries and provisioning coverage of 64%.

Financial highlights

• Total income ₹3,934.52 crore, up 8% YoY; net interest income ₹1,430 crore, up 19%; other income ₹532.10 crore, up 10%.

• Operating profit ₹1,207.75 crore, up 22% in the financial highlights; net profit ₹592 crore, up 18% from ₹502.77 crore.

• Total expenses increased 2% to ₹2,727 crore; provisions and contingencies rose 25% to ₹615.75 crore, including ₹303 crore for NPAs.

• Deposits were ₹32,852.62 crore and gross advances ₹28,238.58 crore at March 31, 2018; total assets reached ₹39,937 crore, up 13%.

Outlook and guidance

• Outlook cited expected support from infrastructure spending, faster project execution and continued reforms; rising business credit needs were seen as a growth opportunity for banking.

• Priorities include secure, customer-centric digital banking, stronger cyber controls and risk management, supported by capital adequacy and technology investment.

• FY19 operating conditions include a 25 bps RBI repo-rate increase to 6.25% and expected credit growth impetus from government recapitalization.