Q2 2025 City Union Bank Ltd Earnings Call Transcript
Key Points
- City Union Bank Ltd (BOM:532210) achieved a 12% year-on-year growth in advances for Q2 FY25, indicating a strong recovery post-COVID.
- The bank's asset quality improved with gross NPA reducing to 3.54% and net NPA to 1.62% in Q2 FY25.
- Interest income grew by 10% in Q2 FY25, with the yield on advances slightly increasing to 9.81%.
- The cost-to-income ratio decreased to 47.06% in Q2 FY25, showing improved operational efficiency.
- The bank's ROA remained stable at 1.55% for the first half of FY25, reflecting consistent profitability.
- The cost-to-income ratio, although improved, is expected to remain slightly higher due to upfront costs associated with digital initiatives.
- The bank's provision coverage ratio is considered an outlier, indicating potential vulnerability in asset quality management.
- Growth in the NBFC lending segment, which is competitive, raises concerns about yield sustainability.
- The bank's deposit growth of 9% lags behind its advances growth, potentially impacting liquidity management.
- The new retail product initiatives are still in the preparatory phase, with significant contributions expected only in the next financial year.
Ladies and gentlemen, good day, and welcome to the City Union Bank Limited Q2 FY25 Conference Call hosted by AMBIT Capital Private Limited. (Operator Instructions) Please note that this conference is being recorded. I now hand the conference over to Mr. Prabal Gandhi from AMBIT Capital. Thank you, and over to you, sir.
Thank you, Neha. I once again welcome everyone for the City Union Bank's Second Quarter earnings call. We have with us Mr. N. Kamakodi, MD and CEO; Mr. R. Vijay Anandh, Executive Director; and Mr. J. Sadagopan, CFO. Without further ado, I'll hand over the call to Dr. Kamakodi for his opening remarks. And post which, we can open the floor for Q&A. Thank you, and over to you, sir.
Good evening, everyone. Heartily welcome to all of you for this conference call to discuss the unaudited financial results of City Union Bank for the second quarter half year ended
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