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Interest expenses hurt Uco

Calcutta, July 27: Uco Bank has reported a 5.27 per cent drop in first-quarter operating profit at Rs 611 crore because of a nearly 50 per cent rise in interest expenses on deposits.

The bank’s net profit, however, inched up 12.42 per cent to Rs 292 crore from Rs 260 crore in the year-ago period, helped by lower provisioning despite a higher slippage in loans.

During the April-June quarter, loans worth Rs 509 crore turned bad, while the slippage stood at Rs 416 crore a year ago.

The bank had made a provisioning of Rs 319 crore compared with Rs 385 crore in the same period a year earlier.

“Last year, we front-loaded our provisioning requirement,” chairman and managing director Arun Kaul said. “In the first quarter of this financial year, we made provisioning in compliance with the Reserve Bank’s stipulations.”

High incidence of bad assets is a perennial problem with the city-based public sector bank. It, however, aggravated last year when the finance ministry asked PSU banks to shift to an auto-tracking system for bad loans.

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