City Union Bank (CUB) Q4 18/19 earnings summary

Executive summary

• FY19 total business reached ₹71,513 crore, up 17% YoY; net profit rose 15% to ₹682.85 crore despite industry headwinds.

• Deposits and gross advances each grew 17%; net interest margin was 4.32%, while asset quality was mixed as net NPA increased to 1.81%.

Financial highlights

• Total income was ₹4,281.55 crore, up 9% YoY; net interest income rose 13% to ₹1,611.49 crore.

• Operating profit increased 3% to ₹1,239.99 crore; net profit rose 15% to ₹682.85 crore.

• Deposits grew to ₹38,447.95 crore and gross advances to ₹33,065.25 crore, both up 17%; total assets rose 13% to ₹45,258.89 crore.

• CASA increased 22% to ₹9,698.19 crore; non-interest income fell 3% to ₹514.39 crore, partly due to fewer treasury opportunities.

• Operating expenses increased 17% to ₹885.89 crore; total provisions and contingencies declined to ₹557.14 crore from ₹615.75 crore.

Outlook and guidance

• FY20 GDP growth was projected at 7.2% by RBI, down from 7.4%; domestic investment weakness and slower global growth were cited as risks.

• Expected sector tailwinds included improving credit offtake and asset quality, continued MSME and MFI lending, and potential retail-loan momentum during the festive season.

• Growth opportunities were linked to infrastructure spending, project execution and reforms; priorities included expanding national presence and using technology and risk management to grow business and profit.

• Financial inclusion outlets were planned to increase from 21 to 50 during FY20.