UCO Bank (UCOBANK) Q4 07/08 earnings summary

Executive summary

• FY 2007-08 net profit rose 30.39% YoY to Rs 412.16 crore; global business grew 20.66% to Rs 1,35,535.88 crore.

• Growth was supported by higher interest income on advances, non-interest income and investment-sale gains; interest expense grew faster than total income.

Financial highlights

• Total income rose 26.39% YoY; interest income increased 22.39%, including 34.34% growth in interest income from advances.

• Other income increased 40.28% to Rs 772.13 crore; profit on investment sales reached a record Rs 210.34 crore vs Rs 53.99 crore.

• Total expenditure increased 31.38%; interest expense rose 38.58%, staff costs 7.37% and non-staff operating expenses 14.45%.

• Net profit was Rs 412.16 crore vs Rs 316.10 crore; domestic net profit grew 45.77% YoY.

Outlook and guidance

• FY 2008-09 priorities: grow CASA deposits, improve cash recoveries and upgrades, recover written-off accounts, curb fresh NPAs and market technology-led services through CBS branches.

• Management targeted higher net profit and stronger customer service in FY 2008-09; no quantified earnings guidance was stated.