Union Bank of India gains on plan to raise Rs 1,000 cr from bonds

Union Bank of India rose 3.11% to Rs 26.50 after the bank said that it will raise up to Rs 1000 crore via issue of debt securities.

In a BSE filing made after market hours on Tuesday (24 November 2020), the state-run lender said that it is issuing Basel III compliant Tier II bonds in the nature of debentures with the aggregate issue size not exceeding Rs 1,000 crore, having a base issue size of up to Rs 500 crore and a Green Shoe option to retain oversubscription up to Rs 500 crore.

The bonds of face value of Rs 10 lakh each, bearing a coupon of 7.18% per annum, will have maturity of 15 years. The deemed allotment date of the bonds is 26 November 2020, it added.

Union Bank of India reported a standalone net profit of Rs 516.62 crore in Q2 FY21 as against a net loss of Rs 1193.61 crore in Q2 FY20. Total income during the quarter jumped 90.3% YoY to Rs 20084.10 crore.

The Government of India held 89.07% stake in Union Bank of India as on 30 September 2020. The bank has a network of 9590 branches and 13,287 ATMs across the country.

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