UCO BANK RoA reaches 0.80% as global NIM rises year on year

UCO BANK reported annualised return on assets of 0.80% for the quarter ended September 2026, up from 0.71% in September 2025 and 0.68% in June 2026. The improvement coincided with a 10-basis-point year-on-year increase in global net interest margin to 3.00%, while return on equity rose to 11.42%.

How did UCO BANK's return on assets change in September 2026?

UCO BANK's annualised return on assets, or RoA, rose to 0.80% in September 2026, an increase of 9 basis points from 0.71% in September 2025 and 12 basis points from 0.68% in June 2026. A basis point is one-hundredth of a percentage point. The September result also moved closer to the 0.87% reported in March 2026, although it remained below that quarter's level.

Return on equity, or RoE, followed the same sequential direction, reaching 11.42% in September 2026 from 10.17% in June 2026 and 10.96% a year earlier. The measure remained below the 13.21% reported in March 2026. Earnings per share, which UCO BANK reports without annualisation, were Rs 0.63 in September 2026, compared with Rs 0.52 in June 2026 and Rs 0.49 in September 2025.

The half-year picture was more moderate than the September-quarter result. Annualised RoA for the half year ended September 2026 was 0.74%, against 0.71% for the half year ended September 2025, while annualised RoE was 11.02%, versus 11.15%. Half-year earnings per share increased to Rs 1.15 from Rs 0.98, showing that the September-quarter acceleration followed a lower 0.68% RoA in June.

What happened to UCO BANK's net interest margin?

UCO BANK's global net interest margin, or NIM, was 3.00% in September 2026, up 10 basis points from 2.90% a year earlier but down 5 basis points from 3.05% in June 2026. NIM measures the spread between interest income and interest expense relative to earning assets. The September global result matched March 2026 and was below the 3.08% reported in December 2025.

Domestic NIM was 3.19% in September 2026, compared with 3.08% in September 2025 and 3.24% in June 2026. Thus, the domestic margin increased 11 basis points year on year but declined 5 basis points quarter on quarter, mirroring the global movement. The domestic measure was also at its March 2026 level of 3.19%, after reaching 3.27% in December 2025.

For the half year ended September 2026, global NIM was 3.02%, compared with 2.93% in the corresponding previous-year half, while domestic NIM rose to 3.22% from 3.13%. These half-year gains put the September-quarter global NIM of 3.00% in context: it was above the year-earlier quarter, but below the half-year average and the June-quarter level.

Why did UCO BANK's lending yields and funding costs matter?

UCO BANK's advance yields were lower than a year earlier in September 2026, while its cost of funds was also lower on that comparison. Global yield on advances was 7.79%, down 27 basis points from 8.06% in September 2025 and unchanged from June 2026. Domestic yield on advances declined to 8.11% from 8.39% a year earlier and 8.14% in June 2026.

The cost of funds was 4.44% in September 2026, 13 basis points below the 4.57% reported in September 2025 but 8 basis points above June's 4.36%. Cost of deposits was 4.75%, up 2 basis points year on year and 5 basis points quarter on quarter. The sequential increase in funding measures occurred as advance yields were flat globally and lower domestically, alongside the 5-basis-point quarter-on-quarter decline in both global and domestic NIM.

Investment yields changed less than lending yields. Global investment yield was 6.68% in September 2026, compared with 6.71% a year earlier and 6.66% in June 2026; domestic investment yield was 6.84%, versus 6.85% and 6.81%, respectively. The reported year-on-year NIM expansion therefore occurred despite lower advance yields, while the quarter-on-quarter NIM movement coincided with higher funding costs.

How did UCO BANK's operating and productivity ratios move?

UCO BANK's cost-to-income ratio was 50.39% in September 2026, compared with 52.79% in September 2025 and 37.49% in June 2026. The year-on-year decline of 2.40 percentage points meant a lower share of income was absorbed by costs than a year earlier. The June comparison requires qualification: UCO BANK said the ratio would have been 45.42% after excluding a one-time recovery from two accounts, rather than the reported 37.49%.

For the half year ended September 2026, the cost-to-income ratio was 43.38%, down from 53.42% in the prior-year half. UCO BANK said the half-year 2026 ratio would have been 47.93% after excluding the same one-time recovery. That disclosure means the reported half-year improvement includes the effect of that recovery, even though the September-quarter ratio of 50.39% was below the prior-year quarter's 52.79%.

Business per employee rose to Rs 30.03 crore in September 2026 from Rs 25.17 crore in September 2025 and Rs 28.47 crore in June 2026. Business per branch increased to Rs 185.15 crore from Rs 161.37 crore a year earlier and Rs 176.77 crore in June. Book value per share also reached Rs 23.25, compared with Rs 19.23 in September 2025 and Rs 22.61 in June 2026.

Conclusion

UCO BANK's September 2026 profitability measures improved from both the prior-year quarter and June 2026, with RoA at 0.80%, RoE at 11.42% and earnings per share at Rs 0.63. Global NIM rose year on year to 3.00%, and the cost-to-income ratio was lower than a year earlier, while business per employee and business per branch increased to Rs 30.03 crore and Rs 185.15 crore, respectively.

The next reported periods will show whether the September recovery in RoA continues while funding costs are rising sequentially. UCO BANK's September data leave a margin trend to watch: cost of funds rose to 4.44% and cost of deposits to 4.75% from June levels, while global advance yield remained at 7.79% and domestic advance yield declined to 8.11%.