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Union Bank reports robust performance, CG Capital Partners becomes majority shareholder

EditorHari G
Published 11/06/2023, 03:24 AM
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Union Bank has reported a strong financial performance in the nine months ending September 2023, with overall income seeing a significant increase of 36% to Rs.17,314 million ($87.1 million). This growth was primarily driven by a 19% rise in net interest income (NII) to Rs.4,822 million, spurred by improved loan portfolio and treasury assets yields following the DDO.

Despite cost management efforts, operating expenses rose by 22%, largely due to increases in utility tariffs, salaries, and general expenses. Even with these increased expenses and the Social Security Contribution Levy (SSCL), the bank's profit before tax (PBT), including equity accounted share of subsidiaries, and profit after tax (PAT) grew by 81% and 65%, respectively.

The bank's total assets stood at Rs.130,319 million while maintaining strong liquidity with a liquid asset ratio of 39.16% and a liquidity coverage ratio of 878%. Loans and advances amounted to Rs.63,204 million, customer deposits to Rs.85,798 million, and the CASA ratio was 24.33%. Despite increased corporate tax rates, Union Bank upheld a healthy capital adequacy position with a total capital ratio of 18.54%. The bank's stage 3 loan ratio improved to 10.52%.

Union Bank Group, which includes UB Finance Company Ltd., and National Asset Management Ltd., saw a 57% PBT increase and a 52% PAT rise. The group held assets worth LKR 138,519 million with the bank's share over 94%, resulting in a notable increase in profitability.

In other news from the bank, on October 24, 2023, Union Bank announced the completion of its transaction with TPG and CG Capital Partners Global Pte Ltd through Culture Financial Holdings. This transaction has resulted in CG Capital Partners becoming the majority shareholder of Union Bank.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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