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However, the Tamil Nadu-based bank experienced a decline in asset quality. Gross non-performing assets (NPAs) constituted 4.66% of gross advances, up from 4.36% in the same period the previous year. On a brighter note, net NPAs saw a marginal decrease to 2.34%.
Additionally, City Union Bank substantially cut back provisions for bad loans and contingencies to Rs 56 crore ($7.5 million) from the preceding year’s Rs 105 crore ($14.0 million). This reduction in provisioning suggests the bank anticipates fewer defaults moving forward.
The bank’s performance this quarter reflects its ability to maintain profitability even amid asset quality concerns. The rise in total income and interest income indicates robust operational efficiency, while the reduction in provisions for bad loans shows an optimistic outlook on future asset performance.
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