Union Bank of India eyes recoveries worth Rs 16,000 crore in FY24

Union Bank of India expects to recover Rs 16,000 crore from the pool of stressed assets in the current financial year (FY24). It pegged the slip to Rs 12,000 crore for FY24.

The bank is working to reduce its total non-performing assets (NPAs) to six percent by March 2024. The Mumbai-based public sector lender’s GNPAs were 7.34 percent at the end of June 2023 (Q1FY24), said Manimkhalai, the bank’s managing director and chief executive officer.

The bank recovered Rs 3,564 crore in Q1 FY24 while slippages were around Rs 3,241 crore in the reporting quarter, the CEO said he addressed the results after the press meeting (Q1 FY24).

There was a large account with an exposure of Rs 1,200 crore which slipped into the compression category.

During the quarter, it wrote off NPAs of about Rs 1,700 crore. The balance of written-off loans was Rs. 72,000 crore. Bank executives said most of the recoveries would come from the pool of loans for which the bank has already made 100 percent provisions in line with the regulations.

The bank has been actively considering dissolution in five stress accounts worth Rs 3,000 crore.

Net NPAs fell to 1.58 percent in June 2023 from 3.31 percent a year earlier. The benefit coverage ratio (PCR) improved to 90.86 percent in June 2023 from 84.75 percent a year earlier.