Mumbai: Union Bank of India reported a 74 per cent drop in its quarterly net profit due to sharply higher bad loans and provisions as lenders comply with a regulatory order to treat some troubled loans as bad in a clean-up drive.
Net profit fell to Rs 78.54 crore ($11.6 million) on a standalone basis for the fiscal third quarter to December 31 from around Rs 300 crore a year earlier, the Mumbai-based bank said in a regulatory filing on Thursday.
Gross bad loans as a percentage of total loans increased to 7.05 per cent in the December quarter from 6.12 per cent in the September quarter.
The Reserve Bank of India has asked lenders to treat some troubled accounts as if they were bad loans and make adequate provisions, as part of its efforts to clean up bank balance sheets by March 2017.
Oriental Bank of Commerce, another state-run lender, on Thursday reported a quarterly loss as bad loans surged.
Top lender State Bank of India and third-biggest state-run lender Bank of India will report third-quarter results later on Thursday.
($1 = 68.0100 Indian rupees)
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