Kolkata based UCO bank, is the second bank this financial quarter, after SBH, to report a net loss due to non – performing – assets (NPAs). The bank reported a net loss of Rs. 384 crores during the second quarter (this quarter) of this financial year, against a net profit of Rs. 156 crores during the second quarter of the last financial year. The bank’s gross NPA ballooned to Rs. 22,275 crores this quarter as opposed to a gross NPA of Rs. 12, 226 crores during the same quarter, last year. The net NPA of the bank rose to Rs. 10,890 crores this quarter, against a net NPA of Rs. 7,123 crores during the same quarter, last year. In terms of percentage, the gross NPA of the bank this quarter, stood at 16.51%, against a gross NPA of 8.51% during the same quarter, last financial year. Total provisions, other than tax and contingencies, of the bank stands at Rs. 1,488 crores this quarter, against provisions of Rs. 913 crores during the same quarter, last financial year. It is a steep increase of almost 63%. Read more on bank losses
UCO bank was formerly known as United Commercial Bank. It was established in 1943 at Kolkata. It is a government owned, commercial bank of India. During February, 2014, its total business was worth Rs. 4.55 lakh crores! It is ranked 1860 on Forbes Global 2000 banks list. UCO Bank was ranked 294th among India’s most trusted brands, according to the Brand Trust Report 2014, a study conducted by Trust Research Advisory. It had risen 796 ranks then when compared to its rank of 1090 in 2013! Currently, the bank has over 6,000 branches and 60 zonal offices spread all over India. UCO bank also has two overseas branches, one each in Singapore and Hong Kong. It is headquartered at BTM Sarani, Kolkata.
Non – performing – assets are a major pain to any bank. This quarter, they caused a massive loss of Rs. 384 crores to UCO bank. In our opinion, banks in India should stop issuing fresh loans, if their NPAs reach a particular size or limit. That way, the banks can curb their losses due to NPAs. Banks in India should also do a thorough verification on the people who take loans. Only if the person or group has the capacity to repay the loan he or she has applied for and only if they show proper collateral for the loan applied, should they be issued loans. Otherwise, loss due to NPAs is inevitable. Hopefully UCO, SBH and other banks in India will learn a lesson form this episode and rectify their loan policies. Read more on Startup News
Love playing sports? Download this app "Win cash rewards while playing sports that you love".