Bank of India, Central Bank and Uco Bank post Q2 profit gains despite margin pressure

Mumbai: Public sector lenders Uco Bank, Central Bank of India and Bank of India recorded gains on account of higher interest income and lower provisions in the September quarter. Over the year, net profit after tax increased by 2.8% to ₹620 crore for Uco bank, 7.6% to ₹2,555 crore for Bank of India and 32.8% to ₹1,213 crore for Central Bank of India.

All the three banks saw a drop in net interest margins (NIMs)-the difference between interest income a bank generates from its assets and the interest it pays out on its liabilities.

NIMs for Bank of India were at 2.41% in Q2FY26 from 2.81% in Q1FY25, for Central Bank of India, NIMs fell 52 basis points to 2.89% during the quarter, from 3.41%, while for Uco Bank NIMs stood at 2.90% from 3.10%. Pressure on NIMs is expected to reduce in the third quarter, bank officials said in the earnings call.

loans grow faster than deposits in q2 at Uco, CBI & BoI

The bank’s net interest income (NII) for Central Bank of India grew 3.7% to ₹3,283 crore, while it grew 10% to ₹ 2,533 crore for Uco bank over the year. For Bank of India, NII reduced by 1% to ₹5,912 crore and 2533 10%
Provisions too, saw a drop by 58% to ₹441 crore for Bank of India and by 54.2% to ₹573 crores. Uco Bank however saw an increase in provisions over the year by 19% to ₹993 crores. “The provisions made are forward looking and prudent,” said Ashwani Kumar, MD & CEO, Uco Bank in the earnings call.

Loan and deposit growth

Loan growth outpaced deposit growth in all the three banks. For Uco Bank, deposits grew at 16.5% to ₹2.3 lakh crore while loans grew 10.8% to ₹ 3.05 lakh crore. For Bank of India, loans grew 14% to ₹7.1 lakh crore while deposits grew 10% to ₹8.5 lakh crore.
For the Central Bank of India, loans grew 16.03% to ₹2.9 lakh crore and deposits grew 13.4% to ₹4.5 lakh crore.
Source – Indonesia News