United Bank Of India will raise Rs 1000 crore Equity Capital

Feb 16, 2014
United Bank of India (UBI) will be raising the capital of up to Rs 1000 crore through the issue of equity capital or bonds to the government. The UBI informed today that it will raise up to Rs 100 crore through a combination of Basel III bonds and  shares to the government and through the organizational investors. Due to the poor performance the bank's Basel III norms adequacy declined.The capital raising would help the bank comply with global norms or Basel III norms of banking sector.

The bank has suffered a net loss of Rs 1238.08 crore in the last quarter due to rising of higher provisioning on bad assets. The bank is going through transformational changes and still there is a hope for growth in future. The capital infusion will be in addition to the Rs 700 crore already allocated by the government.Government holds a 87.99 percent of stake in headquarter of the bank. UBI has to use multiple routes of raising funds  due to the caps on investments and limitations.