City Union Bank Focuses On Emergency Credit Line Guarantee Scheme. 

It was reported that the South-based private sector lender City Union Bank (CUB). had said that it will shift its focus to the ECGLS and gold loans. They will also work on restructuring the facilities for better efficiency. It aims to hand-hold borrowers and keep minimum slippages.N kamakodi has said that the current growth of the Bank is coming from the ECGLS and gold loans only. This will be reviewed in the Q4 and a decision will be taken on how to proceed regarding the plan for the growth.City Union Bank

Credit growth of 6% was seen in the bank in the period between September 30, 2019, and September 2020. This also resulted in the improvement of the Capital Adequacy Ratio (CAR),. It had improved from 16.29% in March 2020 to 17.36% in Q2. CUB sanctioned Rs.1,807 crore till September 30,2020.It was sanctioned under ECLGS.The gold loan is expected to go upto 20-22% as it stands at Rs.4,537 as of now.

N Kamakodi has also said that the bank can achieve a collection efficiency of 90%. They have restructured 175 accounts till September. The restructuring accounts for 5-6%. The accounts which had issues even before COVID will be restructured. The restructuring plans will be in accordance with the regulatory guidelines. A maximum time period will be given to sectors like hotels as they are already under stress.

The City Union Bank has prepared provisions upto Rs.115 crores for Q2. In total there is a COVID provision of Rs.317 crores.

Related News: ECLGS and gold loans are in the most focus of City Union Bank


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