The Hindu : Union Bank's IPO opens on Aug. 20

Online edition of India's National Newspaper
Saturday, Aug 10, 2002

Business

Business

Union Bank's IPO opens on Aug. 20

By Our Corporate Reporter

CHENNAI AUG. 9. Union Bank of India is coming out with a public issue of 18 crore equity shares of Rs. 10 each for cash at a premium of Rs. 6, aggregating Rs. 288 crores.

The issue will remain open from August 20 to 28. The object of the issue is to augment long-term resources, to meet its future capital adequacy requirements and to list the shares on stock exchanges.

Addressing press persons here in connection with the proposed issue, V. Leeladhar, Chairman and Managing Director, said the premium of Rs. 6 had been justified on the score that there had been robust growth in deposits, advances and in operating and net profits in a short period. The bank had returned capital to the extent of Rs. 58 crores to the Government. The Centre's holding in the post- issue capital of Rs. 460 crores would be 60.8 per cent

The total business of the bank stood at Rs. 39,974 crores and total advances at Rs. 21,383 crores as on March 31, 2002. Gross NPA of Rs. 2,420 crores on gross advances works out to 10.77 per cent as compared to 11.20 per cent (Rs. 2,056 crores) on advances of Rs. 18,360 crores. The operating profit has increased to Rs. 856.44 crores during 2001-02 from Rs. 518.94 crores. After making provisions and contingencies, the net profit is higher at Rs. 301.33 crores against Rs. 180.29 crores. The CMD attributed the rise in profit to reduction in costs mainly on account of the implementation of voluntary retirement scheme in the previous year. The gross profit per employee has gone up to Rs. 3.32 lakhs from Rs. 1.85 lakhs.

The identified branches would provide anywhere, anytime banking as also services through other delivery channels such as ATM, Internet banking, mobile baking and telebanking. To have more retail focus, the bank is engaged in depository services, insurance products distribution, gold import, cash management services and personal banking.

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