Union Bank’s Amalgamation results in Rs.341 Crores Net Profit in Q1

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There is no doubt that when the Net profit of a company increases the share price will have a direct effect on it as well. It is all dependent on how the numbers reflect in the chart. If people require proof for the statement, take a look at the share price of Union bank on Monday when they announced their Net profit as of Q1.

Reportedly in last quarter ended in June, Union Bank generated a standalone Net profit of Rs 341 crores. This increased their share price percentage from 1.84% to 6% in NSE. In NSE the stocks gained 5.74% that is Rs 32.20 and in BSE at a price is 32.20 at a 5.7% increase. The bank Amalgamated with Corporation bank and Andhra bank as of April 1, 2020, followed by the spontaneous growth in the Net profit which amounted to 340.95 crores. Before amalgamation, the bank had a profit of 224.3 crores in the June 2019 quarter. There is an increase of Rs 115 Crore compared to the preceding fiscal year.

Union Bank emphasizes the fact that the figures related to June 2019 are from the pre-amalgamated period. Hence it cannot be compared to the post-amalgamated figures. This is due to the involvement of new banks that has a substantial contribution that increased in Net profit standings of the bank. The decision for the amalgamation was the right move made from Union Bank’s Side. The figures for this quarter are speaking about these changes. The overall performance of Union bank is now satisfactory and expects to have more return in the next quarter of this fiscal year. The Bank’s managing director and CEO Rajkiran Rai G said that amalgamation will proceed as fixed previously. He also stated that the Net interest income has seen substantial improvement as it increased by 17.1%. Net interest income is Rs 6403 crore as compared to Rs 5468 crore. The gross non-performing ratio has seen an improvement from 14.95 percent compared to 15.59 percent. All this has an effect on the non-performing asset ratio as well. The NPA improved from 4.97 from 6.47 percent.

Union Bank has also promised its customers that basic services like checking balance inquiry, fund transfer, withdrawal, and deposits will become operational across all the platforms combined. As the effect of this growth, the share prices of Union Bank have increased as well. Share prices of the bank closed at Rs 30.45 on the BSE.

The Union Bank’s amalgamation is a perfect example of good performance and its subsequent results reflecting in the stock markets.

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