INTERVIEW: CMD says UCO Bk Q1 treasury loss provision 1.3 bln rupee

[K.Karthik Raja]

INTERVIEW: CMD says UCO Bk Q1 treasury loss provision 1.3 bln rupee
Tuesday, Jul 8

NEW DELHI - UCO Bank will make a provision of 1.3 bln rupees on
account of
marked-to-market losses on its bond portfolio for the quarter ended
June,
Chairman and Managing Director S.K. Goel said today.
"10-year bond yield (8.24%, 2018) has gone above 9%. The equity
market
portfolio has also depreciated," Goel told NewsWire18.
Of the bank's total bond portfolio, 78% is marked under 'held to
maturity', while the remaining 22% is under 'available for sale' and
'held for
trade' categories.
Bonds held under 'available for sale' and 'held for trade' are
marked-to-market, while those under held to maturity are not required
to be
marked to market.
"Since we have only 22% of the bond portfolio under marked-to-
market, our
treasury losses are not that high," he said.
Since Mar 31, the yield on the 10-year gilt has risen around 135
basis
points.
Goel said there has been negligible growth in the non-priority
sector
lending during the first quarter of the current financial year started
April.
"There is hardly any growth in non-priority sector lending. Even
for the
Jul-Sep quarter, it is expected to grow by 2-3%. However, it is
expected to
pick up in the remaining two quarters," he said.
The bank is aiming at 25% growth in advances in 2008-09. Last
year, the
advances grew at 17%.