Union Bank focuses on cost optimisation for sustained growth | Daily News


 

Union Bank focuses on cost optimisation for sustained growth

Union Bank continued to focus on portfolio alignment and prudent cost management to sustain against a hard-hitting macro economic environment that continued to weigh down the banking sector during the third quarter of 2019.

As a result of focused efforts for enhancing operational efficiency, the Operating Expenses of the Bank increased only by 5% YoY to Rs. 2,960 million within the period under review.

The results of the macro economic shocks that prevailed throughout, continued to affect the banking sector performance in the 3rd quarter of 2019.

Despite policy rate revisions the demand for private credit remained flat, affecting balance sheet growth through the 3rd quarter of the year. Amidst such a challenging business environment, Union Bank strived for revenue optimisation through portfolio re-alignment and enhanced emphasis on fee and commission income generation.

Total Operating Income of the Bank continued to rise reporting Rs.4,637 million which was a YoY increase of 19%. Net Interest Income (NII) for the period ended September 30 was reported as Rs.3,466 million. The Bank’s well executed strategic initiatives for Fee Income growth continued throughout the reporting period, resulting in a 12% YoY growth in Fee and Commission Income which grew to Rs. 784 million. The growth is mainly attributed to the increased influx of Credit Cards processing fees due to focused acquisition efforts along with the fee income generated through transaction banking services provided to corporate and SME banking cients.

 


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