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City Union Bank Ltd

| Quarterly Financial Results Q3 FY 2025-26

BULLISH SENTIMENT

Report Source

⬤2nd Feb 26

Summary : The bank reported strong Q3 and 9M FY26 results with improved profitability and asset quality, despite minor capital adequacy dip.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Total Expenditure: Rs. 148786.77 Lakh (Q3 FY26), Rs. 432782.59 Lakh (9M FY26).
  2. Interest Expended: Rs. 100350.68 Lakh (Q3 FY26), Rs. 297014.03 Lakh (9M FY26).
  3. Operating Expenses: Rs. 48436.09 Lakh (Q3 FY26), Rs. 135768.56 Lakh (9M FY26).
  4. Provisions (other than tax) and contingencies: Rs. 9600.00 Lakh (Q3 FY26), Rs. 22300.00 Lakh (9M FY26).
  5. Tax Expenses: Rs. 8500.00 Lakh (Q3 FY26), Rs. 24500.00 Lakh (9M FY26).
  6. Estimated provision for New Labour Codes: Rs. 200 Lakhs (Q3 & 9M FY26).
  7. Total Income: Rs. 200102.86 Lakh (Q3 FY26), Rs. 576249.20 Lakh (9M FY26).
  8. Interest Earned: Rs. 175568.30 Lakh (Q3 FY26), Rs. 501413.83 Lakh (9M FY26).
  9. Other Income: Rs. 24534.56 Lakh (Q3 FY26), Rs. 74835.37 Lakh (9M FY26).
  10. Segment Revenue (Q3 FY26): Treasury Rs. 34053 Lakh, Corporate/wholesale banking Rs. 46509 Lakh, Retail Banking Rs. 115016 Lakh, Other Banking Operations Rs. 4525 Lakh.
  11. Provision for unhedged foreign currency exposures: Rs. 272.44 Lakh (Dec 31, 2025).
  12. No unprovided liability on pension scheme.
  13. Paid up equity share Capital: Rs. 7420.98 Lakh (Dec 31, 2025).
  14. Net Worth: Rs. 1015718.85 Lakh (Dec 31, 2025).
  15. Total Assets: Rs. 8813030 Lakh (Dec 31, 2025).
  16. Total Liabilities: Rs. 7786623 Lakh (Dec 31, 2025).
  17. Capital Adequacy Ratio (Basel III): 20.13% (Dec 31, 2025).
  18. Gross NPA: 2.17% (Dec 31, 2025).
  19. Net NPA: 0.78% (Dec 31, 2025).
  20. Provision Coverage Ratio: 83% (including Technical write off) & 64% (excluding technical write off) (Dec 31, 2025).
  21. Debt-equity ratio: 0.10 (Dec 31, 2025).
  22. Total debt to total assets: 5.12% (Dec 31, 2025).
  23. Standalone Un-Audited Financial Results.
  24. No subsidiaries/associates/joint ventures, so consolidated not applicable.

Corporate Overview

  1. Domestic Segment
  2. Managing unhedged foreign currency exposures.
  3. Estimating impact of new Labour Codes.
  4. Banking services, including retail and corporate banking.
  5. Factual and compliant with regulatory reporting standards.
  6. Treasury
  7. Corporate / wholesale banking
  8. Retail Banking (including Digital Banking)
  9. Other Banking Operations

Risk Factors

  1. Unhedged foreign currency exposure.
  2. New Labour Codes implementation uncertainty.
  3. Slight decrease in capital adequacy.
  4. Auditor's limited review scope.

Key Drivers

  1. Net profit increased significantly.
  2. Asset quality improved, NPAs reduced.
  3. Return on Assets remained stable.
  4. Strong capital adequacy maintained.

Auditor’s Report

  1. Limited Review Report, not an audit opinion.
  2. No material misstatement found, except for unreviewed Pillar 3 disclosures.
  3. Pillar 3 disclosures (Leverage Ratio, LCR, NSFR) not reviewed by auditors.

Board Commentary

  1. Liability from unhedged foreign currency exposures.
  2. Potential impact of new Labour Codes.
  3. Compliance with SEBI Listing Regulations 2015.
  4. Compliance with RBI guidelines and Companies Act 2013.
  5. New Labour Codes implementation being monitored.

Corporate Governance

  1. Audit Committee reviewed and recommended financial results.

Management Discussion & Analysis

Future Strategy

  1. Monitoring implementation of new Labour Codes.

Performance Drivers

  1. Increased interest income from advances and investments.
  2. Growth in other income from non-fund based activities.

Risk Control Measures

  1. Provision for unhedged foreign currency exposures.
  2. Continuous monitoring of new Labour Codes developments.

Critical Risks

  1. Unhedged foreign currency exposures.
  2. Uncertainty regarding new Labour Codes implementation.
City Union Bank Ltd (CUB) Quarterly Report Analysis & Insights | Dhanarthi