City Union Bank tanks over 6% to near 52-week low after mixed Q1 financial results

City Union Bank shares dropped more than 6 per cent on Monday after the bank reported a mixed financial performance for the first quarter of FY24 and worsening of asset quality.

City Union Bank shares declined by 6.58 per cent to trade near the 52-week low levels in morning deals.

The stock hit a low of Rs 120.50 on BSE inching closer to its 52-week low of Rs 119.50 hit on June 23, 2023.

The stock has declined around 40 per cent from its 52-week high of Rs 204.95 hit on December 15, 2022.

City Union Bank reports mixed performance in June quarter

City Union Bank reported mixed financial numbers for the June quarter post-market hours on Friday. While its net interest income, net interest margin and profit were better than street estimates, loan and deposit growth failed to meet expectations.

Non-performing assets also rose during the first quarter of FY24.

The bank reported a marginal 1 per cent growth in standalone profit at Rs 227.3 crore in June quarter as against Rs 225.1 crore in the year-ago period. The poll estimate was Rs 202 crore for the quarter.

Its net interest income declined 0.45 per cent to Rs 522.5 crore in the June quarter compared to Rs 524.9 crore in the same quarter a year ago, beating the street estimate of Rs 510 crore for the period.

Its provisions dropped 15.8 per cent to Rs 187 crore in the quarter as against Rs 222 crore in the year ago period while a 6 per cent fall on quarterly basis compared to Rs 199 crore in the March quarter.

However loan and deposit growth failed to meet street estimates.  Loan growth was 4 per cent in the June quarter compared to the estimate of 5-8 per cent for the quarter.

Deposit growth at 6 per cent also lagged the Street estimates of 8-10 per cent.

Return on assets was 1.4 per cent in June quarter as against 1.46 per cent while return on equity was 12.1 per cent as against 13.57 per cent.

Gross NPA and Net NPA were higher in the quarter against the street estimate of flat numbers over the March quarter.

Gross NPA remained higher at 4.91 per cent in April-June 2023 compared to 4.37 per cent in the previous quarter.

Similarly Net NPA was higher at 2.51 per cent as against 2.36 per cent in the previous quarter.

Net interest margins stood at 3.67 per cent in the June quarter compared to 3.65 per cent a quarter ago. CASA Ratio was 30.77 per cent compared to 29.88 per cent in the March quarter.

Shares of City Union Bank shares are trading 5.93 per cent down at Rs 121.35 apiece on BSE at 1:25 PM.