Union Bank of India announces Rs 3,000-cr Qualified Institutional Placement at Rs 142.78 per share

State lender Union Bank of India today announced a Rs 3,000-crore qualified institutional placement (QIP) at a floor price of Rs 142.78 per share. By the  Qualified Institutional Placement (QIP) method, listed companies can raise capital by issuing equities, or other equity convertible securities to qualified institutional buyers. The bank also announced the opening of the issue on February 20.

"We wish to inform you that the Committee of Directors for Raising Capital Funds (“Committee”) has at its meeting held today i.e. February 20, 2024 approved the raising of funds for an amount not exceeding Rs 3,000 Crore through issue of equity shares through Qualified Institutions Placement subject to the requisite regulatory /statutory approvals," said the bank in a stock exchange filing.

The shares of Union Bank of India Rs 141.10, down by 0.07%. 

The 52-week high of Union Bank of India's scrip is Rs 155.35 and 52-week low is Rs 60.35.

"We further wish to inform you that the ‘Relevant Date’ for the purpose of the Issue, in terms of the Regulation 171(b)(i) of the SEBI ICDR Regulations, is February 20, 2024 and accordingly the Floor Price in respect of the aforesaid Issue, based on the pricing formula as prescribed under Regulation 176(1) of the SEBI ICDR Regulations is ₹ 142.78 per Equity Share. Pursuant to the SEBI ICDR Regulations, the Bank may offer a discount of not more than 5% on the Floor Price so calculated for the Issue," the bank said.

Union Bank of India's reported a 60 per cent year-on-year (YoY) jump in net profit at Rs 3,589.9 crore for the December quarter. In the corresponding quarter last year, Union Bank of India posted a net profit of Rs 2,244.8 crore, the bank said in a regulatory filing.

Net interest income (NII) rose 6.3 per cent to Rs 9,168 crore against Rs 8,628.1 crore in the corresponding quarter of FY23.

The gross non-performing asset (GNPA) stood at 4.83% in the December quarter against 6.38% in the September quarter. Net NPA came at 1.08% against 1.30% quarter-on-quarter.