The bank’s Profit after Tax (PAT) for the second quarter improved by 119% to Rs. 126.4 million, when compared with the same period in 2012 despite challenging market conditions during the first half of 2013. The bank also recorded an increase in profits in the first half of 2013 as compared with 2012 to show Rs. 189.3 million, an 18% growth. The group profits for the period also showed an increase to Rs. 54 million recording a 142% growth and cumulative profits recorded Rs. 107.2 million showing a decrease of 26% in comparison to the comparative period, mainly due to weak Q1 performance. The group profits also dipped in comparison to the bank due to the slow performance of UB Finance during the period.
Net fee and commission income increased by 44% during the quarter versus last year and other income recorded a 201% growth. The significant increase in other income was mainly due to a disposal of UB Finance shares that was held by the bank. Total assets of the bank in 2013 increased by 12% in the first half of the year to Rs. 34.60 million when compared with December 2012 and the group also recorded a 14% increase to Rs. 36.02 million.
The total equity of the bank stood at Rs. 5.53 million at the end of June 2013 and net assets per share as at the reporting date is Rs. 15.84.
Commenting on the performance, Union Bank Director / CEO Anil Amarasuriya stated that the bank had recorded significant growth in the second quarter despite the challenging external environment. He also stated that the growth the bank has achieved in this quarter will provide a positive platform to leverage sustainable growth in 2013.
Union Bank also continues to successfully journey towards its aspirations of positioning itself as the ‘Top of Mind’ SME Bank in Sri Lanka.
Amarasuriya said: “At Union Bank our focus is clear. We want to become the ‘SME Bank’ in Sri Lanka because we know our fundamentals are apt for us to add value to this consumer sector.” The bank is also expected to expand its network to fifty branches by the end of this year which will be specially focused and geared to grow Union Bank’s SME portfolio.
Capitalising on the myriad of opportunities in the SME sector, Union Bank is currently developing a new core banking system, which will complete rollout this year. This will help to give the bank a significant upward momentum in technological advancements and assist the bank to move towards its objective of being an IT premiered bank in the country. Additionally, with the intention of accelerating Union Bank’s SME presence, a sophisticated robust risk management system was also acquired to enable more responsiveness to customers. Union Bank has also launched a host of new products and ancillary services adding value to the bank’s promise of providing total financial solutions to SME and retail customers.
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