Union Bank of India (UNIONBANK) Q1 24/25 earnings summary

Executive summary

• Net profit for Q1 FY25 rose 13.7% year-over-year to INR 3,679 crore, with operating profit up 8.5% year-over-year to INR 7,785 crore.

• Achieved 8.5% year-over-year deposit growth and 11.5% growth in advances, in line with FY25 guidance.

• Asset quality improved, with GNPA at 4.54% and NNPA at 0.90%, both showing notable reductions.

• Maintained strong capital position with CRAR at 17.02% and CET-1 at 13.81%.

• S&P Global Ratings revised outlook to positive; India Ratings upgraded to AAA/Stable.

Financial highlights

• NIM at 3.05%, above guidance of 2.8%-3%; NII grew 6.47% year-over-year to ₹9,412 crore.

• CASA and retail term deposits form 72% of total deposits; CASA ratio declined by 120 bps year-over-year to 33.4%.

• Gross NPA reduced to 4.54%; net NPA at 0.90%; PCR improved to 93.5%.

• Credit cost improved to 0.73%, down from 0.97% year-over-year.

• Cost-to-income ratio stood at 44.08% for Q1FY25.

Outlook and guidance

• Guidance maintained for deposit growth (9%-11%) and advances growth (11%-13%) for FY25.

• NIM guidance is 2.8%-3.0%, with Q1 actual at 3.05%.

• Cost-to-income ratio expected to remain in the 42%-45.5% range.

• ROA guidance above 1% for the year.

• Credit cost expected to stay below 1% barring one-off events.