Mumbai, 23 September 2023: Union Bank of India’s Basel III compliant Tier-II and Tier-I Bonds rated by CARE Ratings Limited have been upgraded to AAA and AA+, respectively with stable outlook.
The ‘stable’ outlook reflects CARE Ratings’ expectation that Union Bank of India will continue to maintain its steady growth in advances, deposits, and a healthy profitability profile over the medium term while maintaining stable asset quality.
The revision in the ratings assigned to debt instruments of Union Bank of India factors in sustained improvement in asset quality parameters and profitability during FY23 and Q1FY24. The Bank has seen reduction in incremental slippages which along with expected recoveries from non-performing assets (NPAs), is expected to further improve the asset quality- parameters leading to lower credit cost and resultant improvement in profitability, going forward. The ratings also take note of the strengthening of the capitalisation levels post the qualified institutional placement (QIP) of equity share capital of ₹5,000 crore in the month of August 2023, which has boosted the Bank’s the ability to fund its near-term credit growth.
