City Union Bank has released the transcript of its Q1 FY27 earnings conference call. The document details the bank’s financial performance, including deposit and advances growth, asset quality, net interest margins, and operating profits. Management discussed strategies for MSME and gold loan segments, outlook on cost of funds, and future growth projections, emphasizing continued business growth with better asset quality.
City Union Bank Releases Q1 FY27 Earnings Call Transcript
City Union Bank has published the transcript of its Earnings Conference Call for the first quarter of Fiscal Year 2027 (Q1 FY27), held on July 28, 2026. The transcript provides a comprehensive overview of the bank’s financial results and strategic outlook. The call featured insights from Mr. R. Vijay Anandh (MD & CEO), Mr. V. Ramesh (Executive Director), and Mr. J. Sadagopan (CFO).
Financial Highlights and Performance
During Q1 FY27, City Union Bank reported a 21% growth in deposits, reaching Rs. 79,342 crore, with average CASA growing by 22% to Rs. 20,062 crore. The bank achieved a 25% credit growth quarter-on-quarter, with advances increasing to Rs. 67,645 crore from Rs. 54,020 crore in 1QFY26. Gross NPA reduced to 1.73% and Net NPA to 0.61%. Operating profit grew by 29% to Rs. 581 crore, and PAT grew by 25% to Rs. 383 crore.
Strategic Focus and Future Outlook
The bank reiterated its focus on MSME lending and secured retail products, aiming for credit growth 2-3% above industry levels. Management expressed confidence in maintaining long-term average numbers for PAT, ROA, and NIM. The Net Interest Margin (NIM) for Q1 FY27 stood at 3.78%, with expectations of it hovering around 3.65% to 3.70% in the coming quarters. The Cost-to-Income ratio reduced to 45.42%, with a target to remain in the 47%-48% range for FY27. The bank anticipates continued business growth supported by better asset quality.
Key Segment Discussions
Discussions covered the gold loan segment, where the bank maintains its pricing and sees stable competition. MSME growth was highlighted, with expectations to grow 2-3% above the system, supported by consumption and asset quality. The bank also provided guidance on slippage numbers, expecting them to be around 1% to 1.25% and credit cost around 0.40% in the medium term. The bank is also actively participating in the ECLGS scheme, with disbursements reaching Rs. 800 crore and an estimated total of Rs. 2,000-2,500 crore under the scheme.
Operational and Growth Strategies
Regarding operational efficiency, the bank aims to bring the cost-to-income ratio below 45% within three years, leveraging automation and AI. The bank’s ticket sizes for MSME and LAP segments are expected to remain stable, with a preference for granular business. The average LCR for the quarter was 150%. Management expressed optimism about the automotive and textile sectors as key drivers for future MSME growth.
Source: BSE
