Stocks of City Union Bank came under profit booking. Know why

City Union Bank, a private lender, reported a modest rise in quarterly earnings on the back of rising lending even as its stock came under profit booking after earnings were reported.

City Union said its first quarter profit rose 12 percent to 111.5 crore rupees versus 99.5 crore rupees in the same period a year ago. Net Interest Income gained 20 percent to 224 crore rupees compared with 186.7 crore rupees in the year ago quarter.

City Union is among the few banks that have exercised strong control over their non-performing asset portfolio. Its Gross NPAs rose to 2.01 percent in the first quarter versus 1.86 percent sequentially and its Net NPAs inched up to 1.32 percent from 1.3 percent sequentially. Larger banks have a major problem with non performing loans.

City Union fell a rupee, or 1 percent, to 98.80 rupees on the National Stock Exchange where 8.6 lakh shares changed hands by 12:30 pmversus its 5-day average of 2.8 lakh shares.

City Union's market capitalisation surged 37 percent to 5,943 crore rupees in the past one year.

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