Macro economic indicators - UCO Bank

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Macro economic indicators

The Macro picture

• Underlying economic currents remained weak for India throughout FY15.

• Official estimates of GDP place economic growth for FY15 at 7.3% to 7.5%

• Subdued inflation paving the way for ratecuts- RBI has already cut REPO rate by 75 bpsuntil now (last rate cut was 25 bps on 2nd June2015).

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Overleveraged Indian Corporate – Debt laden and strugglingafter 2 years of weak economic expansionWith the economy not picking up as expected, manycompanies were unable to service their debt, leaving no roomfor fresh credit demandGrowth rate in bank lending in FY’15 at 12.6% is the lowest inalmost 2 decadesAnother factor that has weighed on bank loans is cheaperavailability of funds through commercial papers & bondsLegislative setbacks, still subdued corporate profitability & aslow pace of growth recovery has led to rising impaired assetson public sector bank balance sheets

The Economic & Banking

scenario

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Highlights of Bank’s Performance during QE & FY ending

Mar'15CAR at 12.17% ( Basel-III) of our Bank is the highest amongst the banks of the samesize and ranks 4th when compared with other PSU Bank’s.Our Cost to Income ratio for FY’15 at 37.74% is one of the lowest in the industry.Average cost of deposit at 6.35% is one of the lowest among peer banks and thethird lowest among the PSU Bank’s.The ‘ROE’ at 10.41% for FY 2015 is the third highest among PSU Banks.

Our Bank pursued a conscious strategy of selective growth in quality credit . Thetotal Advances as at Mar’15 stood at Rs. 1.52 lac cr., almost at the same level asat Mar’14

Global Deposit (Rs. 2.14 lakh cr.) as on 31st Mar’15 registered 7.42% YoY growth.Core deposits grew by 10.8% YoY to reach Rs. 1.45 lac cr. & formed 75.1% of TotalDomestic Deposits as on Mar’15

CASA deposits as on Mar’15 stood at Rs. 62,375 cr. which was 32.23 % of domesticdeposit

Retail Assets as on Mar'15 showed healthy rise of 20% YoY to reach Rs. 18,718 cr.

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Highlights of Bank’s Performance during QE & FY ending

Mar'15

Both our Operating Profit & Net Profit for FY’15 are the highest amongst peerbanks.

Operating Profit for Q4FY'15 was Rs. 1227.27Cr. (Rs. 1373.23 Cr.) while same forFY'15 was Rs. 4910.22 Cr. (Rs. 4940 cr.)

Net Profit for Q4FY'15 was Rs. 209.28 Cr. (Rs. 285 Cr.) while same for FY'15 was Rs.1137.80 Cr. (Rs. 1511 cr.) .

‘Treasury Profits from sale of investments and foreign exchange gain’’ for the FY-2015 at Rs: 1226.50 Crore is one of the highest among peer banks. Treasury profitfor Q-4( 2014-15) was Rs: 459 Crores.

Other income registered 51.70% growth – one of the highest amongst PSBs - toreach Rs. 2004 Cr. (Rs. 1321 Cr.)

Total income in the current fiscal rose by 9.27% YoY to Rs. 21363 cr. (Rs. 19,550 cr.)

Bank acquired 59.84 lac (34.79 lac) new customers in FY'15

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Movement of business parameters [ Amt. in Rs. Crore ]

FY Q4

PARAMETERS 2014-15 2013-14Change (%)

Y-O-Y2014-15 2013-14

Change (%)Y-O-Y

Total Deposit at end FY 214337 199533 7.42%214337 199533 7.42%

Total Advance at end FY 151812 153163 -0.88%151812 153163 -0.88%

Total Income 21362.54 19550.43 9.27%5263 5309 -0.90%

Net Interest Income 5562.45 6059.09 -8.20%1276 1560 -18.21%

Operating Profit 4910.22 4940.4 -0.62%1227 1373 -10.63%

Provisions 3772.42 3429.85 9.98%1017 1088 -6.43%

Net Profit 1137.8 1510.54 -24.66%209 285 -26.67%

Gross NPA (amt.) 10265.05 6621.37 55.03%10265 6621 55.04%

Gross NPA % 6.76 4.32 6.76 4.32

Net NPA (amt.) 6330.58 3556.43 78.02%6331 3556 78.01%

Net NPA % 4.30 2.38 4.30 2.38

CASA(Dom.) 62375.6 58883.7 5.93%62376 58884 5.93%

Cost to income (%) 37.74 33.05 39.26 31.98

ROA 0.48 0.70 0.35 0.49

NIM (Global) 2.35 2.82 2.12 2.70

NIM (Domestic) 2.52 3.02 2.27 2.87

NPA Prov coverage 52.65 57.02 52.65 57.02

Book Value per share 111 104.85 5.87%111 104.85 5.87%

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Deposit components[ Amt. in Rs. Crore ]

QE Mar'14

Parameters QE

Mar'15

182730.32 A) Deposit (Domestic) 193552.47

25353.30 Current 26149.39

33530.40 Savings 36226.21

58883.70 CASA 62375.60

32.14% Share of CASA (%) 32.23%

72295.57 Normal Term Deposit 83022

131179.27 Core Deposit 145397.60

16803.23 B) Deposit (Overseas) 20784.24

199533.55 C)Total Deposit (Global) 214336.71

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[ Amt. in Rs. Crore ]Retail Business

Position as on 31.03.2014 Position as on 31.12.2014Scheme

Position as on 31.03.2015

Amount Amount A/c Amount

8176 10411 UCO Home 95260 11072

2896 2460 UCO Car 29771 2251

1262 1318 UCO Education 55796 1319

539 521 UCO Cash 48207 515

2726 3543Other Retail

Schemes 143212 3561

15599 18253 Total Retail 372246 18718

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[ Amts. in Rs. Crore ]

Investment Portfolio as on 31-03-2015

Portfolio Amount INR Crore % to NDTL

Investment in SLR (G Sec)

• HFT 0 0

• AFS 17556 9.4%

• HTM 37812 20.24%

Sub Total (Investment in SLR) 55368 29.64

Investment in Non - SLR

• HFT 0 0

• AFS 7191 3.85

• HTM 190 0.10

Sub Total (Investment in Non - SLR) 7381 3.95

Priority Sector Investment 4636 2.48

Gross Total (SLR + Non-SLR) 67385 36.08

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[ Amts. in Rs. Crore ]

Investments in Last 5 years

31.3.2011 31.3.2012 31.3.2013 31.3.2014 31.3.2015

SLR (G-sec) 34963 40092 43347 53017 55368

Non-SLR 6425 4946 7987 12782 12017

TOTAL 41388 45038 51334 65799 67385

CATEGORY

Composition as on

31.3.2011 31.3.2012 31.3.2013 31.3.2014 31.3.2015

H T M 27675 32827 35661 46064 42637

% of Net Investment 67.17 73.56 69.81 70.28 63.27

A F S 13713 12032 15673 19735 24748

% of Net Investment 33.28 26.96 30.68 30.11 36.73

H F T 0 179 0 0 0

% of Net Investment 0.00 0.40 0.00 0.00 0

Gross Investment 41388 45038 51334 65799 67385

Depreciation & Provision 188 410 248 254 328

Net Investment 41200 44628 51086 65545 67057

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Banks’ Asset Health – The reality check

FY’15 was an exceptionally bad year for state-owned lenders since loan growthslipped to record lows while impaired assets hit new highs & provisions soared

The investment cycle is showing no signs of revival yet & demand for variousconsumer goods remains subdued. There is industrial over-capacity & part of thereason for low inflation is lack of demand

Banks are struggling to cope with sticky assets, since many infrastructure projectsremain stalled & debt piling up in the books of infrastructure companies is a majorroadblock to revive sentiment

Companies are in trouble & corporate cash-flows are going to be strained forseveral years—which means credit costs could continue to rise since it is not goingto be easy to recover the money

The low credit growth has affected bank books. The low credit expansion meantless earning from interest income. Also non-performing accounts made a dent intointerest income

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Impaired Assets movement Q-o-Q

[ Amt. in Rs. Crore ]

As on / during the QE Mar'14

Parameters As on / during the QE As

on/during FY '14-15Jun'14 Sep'14 Dec'14 Mar'15

7353.30Gross NPA (Opening Balance @ beginning of Qtr/ FY)

6621.37 6346.32 7446.64 9530.63 6621.37

1761.32 Slippage (during the Qtr/FY) 591.83 2127.67 2757.54 2074.28 7551.31

1860.39 Recovery + Upgradation 783.62 644.90 285.94 792.04 2506.49

632.86 Write off 83.26 382.45 387.61 547.82 1401.14

6621.37Gross NPA (Closing Balance @ end of Qtr / FY)

6346.32 7446.64 9530.6310265.0

510265.05

4.32% Gross NPA (%) 4.31% 5.20% 6.50% 6.76% 6.76%

3064.95Eligible Deductions including Provisions (net of write back & write off) at QE

3002.30 3057.98 3479.17 3934.47 3934.47

3556.43 Net NPA 3344.02 4388.66 6051.46 6330.58 6330.58

2.38% Net NPA (%) 2.33% 3.15% 4.25% 4.30% 4.30%

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Sector wise NPAs (Domestic) [ Amt. in Rs. Crore ]

Parameters As on / during the QE

Mar'14 Jun'14 Sep'14 Dec'14 Mar'15

1 Agriculture & Allied Activities 951.23 937.73 861.82 999.83 1298

2 Micro & Small Industries 1206.65 1233.80 1182.24 1388.24 1401

3 Medium Industries 316.05 322.38 545.24 638.85 537

4 Large Industries 2294.53 2230.20 2943.95 3933.04 4592

5 Services 923.74 714.90 877.34 1160.32 1109

6 Retail 378.65 374.11 395.67 504.57 769

7 All Others 204.16 169.33 229.26 470.61 76

Total 6275.01 5982.46 7035.52 9095.50 9782

NPAs from Large & Medium industries at Rs. 5129 Cr. constituted 52.43 % & those from Agri &Allied sectors 13% of total NPAs as on 31 Mar’15

Standard Restructured assets worth Rs. 2559.46 Cr. (i.e.23% of opening balance on 01-4-2014) slipped into NPA category in FY’15

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Restructured Standard Assets

Q4 FY'15 Details Amt.(Cr.)

Total Restructured Assets as on 01 Jan’2015 9510.55

Add: Standard Accounts restructured during Q4FY'15 2333.62

Less: Total Standard Restructured accounts closed during Qtr.* -

Less : Accounts slipped to NPA 961.33

Total Standard Restructured as on 31 Mar'2015 10795.78

% age of Restructured Advances to Total Loans & Advances as on March, 2015 [Global Advances being Rs. 151812.23Cr.]

* Including the accounts which cease to attract higher provisioning

Details for FY 2014-15 Amt.(Cr.)

Total Restructured Assets as on 01 Apr’2014 11164.91

Add: Standard Accounts restructured during FY 2014-15 4243.77

Less: Total Standard Restructured accounts closed during FY* 2880.65

Less : Accounts slipped to NPA 2559.46

Total Standard Restructured as on 31 Mar'2015 10795.78

* Including the accounts which cease to attract higher provisioning

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Income, Expenditure & Profit (Global)[ Amt. in Rs. Crore]

During Qtr. YoY Change During FY YoY Change

Q4 FY'14 Q4FY'15 Amt. % 2013-14 2014-15 Amt. %

5309.27 5263.35 -45.92 -0.80% I)Total Income (a+b) : 19550.42 21362.54 1812.11 9.27

4850.35 4600.80 -249.55 -5.14% a)Interest Income 18229.91 19358.99 1129.08 6.19

3539.80 3259.53 -280.27 -7.93% Interest on Advances 13630.68 13900.58 269.90 1.98

1253 1261.34 8.34 0.64% Income on Investments 4385.68 5194.51 808.82 18.44

57.55 79.93 22.38 38.89 Other Interest Income 213.55 263.90 50.35 23.58

458.92 662.50 204.08 44.37 b)Other Income 1320.51 2003.55 683.04 51.72

3936.04 4036.08 99.06 2.54 II)Total Expenses 14610.03 16452.32 1842.30 12.61

3290.45 3325.14 34.69 1.05 Interest Paid 12170.83 13796.54 1625.71 13.36

645.59 710.94 65.35 10.13 Operating Expenses 2439.20 2655.78 216.58 8.88

1373.23 1227.27 -145.96 -10.63 III)Operating Profit (I-II): 4940.39 4910.22 -30.17 -0.61

1088.53 1017.99 -70.54 -6.48 IV)Provisions 3429.85 3772.42 342.57 9.97

284.70 209.28 -75.42 -26.49 V)Net Profit (III-IV) : 1510.54 1137.80 -372.74 -24.68

1559.90 1275.66 -284.24 -18.22 Net Interest Income 6059.08 5562 -496.63 -8.20

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Ratio Analysis

During During FY

Q4 FY'14 Q4FY'15 2013-14 2014-15

6.16 6.13 Cost of Deposit (%) 6.17 6.35

9.8 10.24 Yield on Advances (%) 9.91 9.92

8.30 8.19 Yield on Investment* (%) 8.11 8.28

8.46 10.91 Return on Investment * (%) 8.55 9.88

2.70 2.12 Net Interest Margin Global (%) 2.82 2.35

2.87 2.27 Net Interest Margin Domestic (%) 3.02 2.52

31.98 39.26 Cost to Income Ratio (%) 33.05 37.74

4.32 6.76 GNPA (%) 4.32 6.76

2.38 4.30 NNPA (%) 2.38 4.30

57.02 52.65 NPA Provision Coverage (%) 57.02 52.65

13.40 12.91 CRAR (Basel-II) (%) 13.40 12.91

*Excluding RIDF Investment

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Profitability Indicators

During During FY

Q4 FY'14 Q4FY'15 2013-14 2014-15

0.49 0.35 Return on Assets (%) 0.70 0.48

13.14 7.66 Return on Equity (%) 17.43 10.41

2.38 2.04 Op. Profit to AWF (%) 2.30 2.08

104.85 111 Book Value per Share (Rs.) 104.85 111

3.34 2.06 Earnings per Share (Rs.) 19.44 11.20

10284.89 11584.58Net Worth (Absolute) excl. revaluation

reserve 10284.89 11584.58

2.70% 2.12% Net-interest income to AWF (%) 2.82% 2.35%

0.80% 1.10% Non-interest income to AWF (%) 0.61% 0.85%

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Capital Adequacy[ Amt. in Rs. Crore]

31-03-2014 31-12-2014 PARAMETERS 31-03-2015

116636.78 121497.97 Total Risk Weighted Assets 126380.39

98911.36 101759.54 Credit Risk 105681.94

9345.17 9911.61 Market Risk 10871.63

8380.25 9826.82 Operational Risk 9826.82

14784.53 14722.19 Total Capital Fund 15376.30

10157.22 10277.27 Tier I Capital Fund 11431.59

4627.31 4444.92 Tier II Capital Fund 3944.71

13.40 12.54Under

BASEL II

Capital Adequacy Ratio (%) 12.91

8.9 8.49 Tier I (%) 9.08

4.5 4.05 Tier II (%) 3.83

12.68 12.12Under

BASEL III

Capital Adequacy Ratio (%) 12.17

8.71 8.16 Tier I (%) 9.05

3.97 3.66 Tier II (%) 3.12

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Awards & Accolades in FY'14-15

Business Today magazine ranked UCO Bank 7th in the BT-KPMG ‘FY 2013-14 Bank rankings’,after 6 top private sector banks & only one bank in the Public Sector. UCO Bank’s rank was 20in FY2012-13

In the ‘Fastest Growing Bank Rankings’ by Business World magazine, UCO saw a big jump inits growth rankings to the 7th position in 2014, from 17th in 2013

UCO Bank received prestigious SKOCH AWARD for Excellence in Banking in Financial Inclusion& Deeping 2014

Adjudged as the best banker at the national level for the year 2013-14 & awarded BankingExcellency Award 2013-14 by State Forum of Bankers Club at Kochi in Dec’2014

UCO has won the Best Bank award for operational performance & runner-up prize for beingtech-savy in “MSME Banking Excellence Awards -2014” organized by Chamber of Indian MicroSmall & Medium Enterprises.

UCO Bank had been awarded First Prize for Highest average loan to SHGs in West BengalState during the year 2013-14 under Commercial Bank category on the eve of celebration ofNABARD Foundation Day on 12.07

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New initiatives

Recent launching of “UCO SMART Kids” - a liability product for children of 10years and above and “UCO Yatra” - a new loan product

Introduction of mobile Banking facility that allows to view account relatedinformation, transfer funds, recharge mobile account and much more

Allowing Balance Inquiry & Mini Statement display of OD, CC, CA & SB a/csthrough Missed Call at specified mobile nos. from registered mobile no.

Launching of Loyalty Reward Programme (to boost ADC usage) wherebycustomers need to log onto www.ucobankrewardz.com for enrolment andredemption of reward points for use of Debit Card/ UCO Bank ATM Withdrawal/Net Banking / Online Shopping/ setting Auto-Debit from SB A/cs for Retail Loans

Bank has implemented unique Smart Card Based FI Solution with 4 differentCorporate BC Partners. This model has the unique feature which allows inter-operability among the BCs as well as real time online transactions straight fromthe remotest village with Bank’s CBS

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Financial Inclusion initiatives

Initiatives During Q4FY15 Cum. as on 31.03.2015

Villages covered with > 2000 population (a) -------- 1833

through Branches -------- 349

through BCs -------- 1484

Villages covered with < 2000 population (b) -------- 15269

through Branches -------- 28

through BCs -------- 15241

Total no. of villages covered (a) + (b) -------- 17102

Total no. of BSBD accounts opened (In lakh) 8.74 79.40

USBs opened3072 (During the

year 2014-15)4317

No. of Smart card issued (In lakh) 0.85 14.50

No. of transactions in the a/cs opened under ICT based BC model (in lakh)

43.78 73.67

No. of KCCs extended (In lakh) 0.17 5.43

No. of GCCs extended (In lakh) 0.01 1.94

No. of all other Deposit accts (In lakh) 10.72 221.28

No. of all other Advance accts (In lakh) 1.38 10.98

No. of SHGs credit linked 1987 82123

No. of JLGs credit linked 269 6975

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Growth in touch points

2152 22062394

26142894 3020

0

500

1000

1500

2000

2500

3000

3500

31Mar'10 31Mar'11 31Mar'12 31Mar'13 31Mar'14 31Mar'15

Branches (Global)

0 0 65

763

1245

4317

0

1000

2000

3000

4000

5000

31Mar'10 31Mar'11 31Mar'12 31Mar'13 31Mar'14 31Mar'15

USB

8.61

13.32

18.93

27.44

41.53

61.12

0 10 20 30 40 50 60 70

31Mar'10

31Mar'11

31Mar'12

31Mar'13

31Mar'14

31Mar'15

Cards (lacs)

477

607

864

1361

2085

2096

0 500 1000 1500 2000 2500

31Mar'10

31Mar'11

31Mar'12

31Mar'13

31Mar'14

31Mar'15

ATMs

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Customer acquisitions (in lakhs)

15.37

21.00

28.12

34.79

59.84

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

FY'2010-11 FY'2011-12 FY'2012-13 FY'2013-14 FY'2014-15

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Changing Employee profile

Employee ProfileAs on 31-Mar-11 31-Mar-12 31-Mar-13 31-Mar-14 31-Mar-15

Officers Staff Officers Staff Officers Staff Officers Staff Officers Staff

<= 30 yr 602 618 1011 1222 2532 1323 3303 1862 4117 2860

7.28% 4.19% 11.16% 8.67% 23.40% 9.96% 28.49% 14.36% 33.53% 22.07%>30 yrs to

45 yrs 909 2169 1038 1897 1485 2258 1932 1899 2488 1857

10.99% 14.70% 11.46% 13.47% 13.72% 16.99% 16.66% 14.65% 20.26% 14.33%> 45 yrs to

55 yrs 3954 7069 3703 6107 3216 5761 2679 5131 2078 3762

47.79% 47.92% 40.88% 43.35% 29.72% 43.35% 23.11% 39.58% 16.92% 29.03%

>55 yrs 2809 4896 3307 4862 3588 3946 3680 4071 3596 4478

33.95% 33.19% 36.51% 34.51% 33.16% 29.70% 31.74% 31.40% 29.28% 34.56%Category

Total 8274 14752 9059 14088 10821 13288 11594 12963 12279 12957Total

Employee 23026 23147 24109 24557 25326

• % age of officers below 30 yrs, stands at 33.53% as on Mar’15 from only 7.28% as on Mar’2011• Officers below 45 yrs. have jumped 3 times in the last three & half years & today constitute 54% of

total officers’ strength, as against only 18% as on Mar’2011• The average age of employees has come down from 49.70 as on Mar’2011 to 43.75 & that of officers

to 41.58 years, as on Mar’2015. 5 years hence it will be a truly young workforce bringing indynamism & modern outlook

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CAGR between 31Mar’10 & 31Mar'15

11.85

12.73

16.06

1.66

10.39

19.07

23.54

2.37

22.69

0.70

0.00

5.00

10.00

15.00

20.00

25.00

Total Deposits Total Advances CASA Employees Biz/ emp. Net InterestIncome

Operatingprofit

Net Profit Op. Profit/emp. Net profit/emp.

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