Union Bank of India (UNIONBANK) Q2 24/25 earnings summary

Executive summary

• Net profit for Q2 FY25 was ₹4,720 crore, up 34.43% year-on-year; operating profit reached ₹8,113 crore, up 12.4% year-on-year.

• ROA improved to 1.35% and ROE to 19.10% for Q2 FY25.

• Global business mix reached ₹21.71 trillion, with advances at ₹9.29 trillion and deposits at ₹12.42 trillion as of September 2024.

• Performance aligns with FY 2025 guidance, despite a large one-off slippage.

• Financial statements prepared per Indian GAAP and RBI guidelines, reviewed and approved by the Board.

Financial highlights

• Deposits grew 9.2% year-on-year; advances up 9.6%.

• Net Interest Income for Q2FY25 was ₹9,047 crore; NIM at 2.97% for H1 FY25, within guidance of 2.8%-3%.

• Cost-to-income ratio improved to 43.56% from 44.08% sequentially; EPS for H1FY25 was ₹22.00, up from ₹19.44 YoY.

• Gross NPA reduced by 202 bps to 4.36%; net NPA down by 32 bps to 0.98%.

• Provision coverage ratio increased to 92.79%.

Outlook and guidance

• Confident in achieving FY 2025 targets for credit growth (11%-13%) and deposit growth (9%-11%).

• NIM expected to remain in 2.8%-3% range.

• Credit cost targeted at or below 1% for FY 2025.

• Recovery guidance for FY 2025 maintained at INR 16,000 crores.

• GNPA expected to remain below 4.00%; actual was 4.36% as of September 2024.