Union Bank of India Looks to Raise Rs 2,500 Cr via QIP

Mumbai: Days after it got shareholders' approval to raise around Rs 3,700 crore, state-owned Union Bank of India has said it's planning to mop up Rs 2,500 crore through qualified institutional placement (QIP) next month.

"We may look at raising Rs 2,500 crore through the QIP route towards the end of the next month," chairman and managing director Arun Tiwari told PTI.

In its recently held AGM, the bank has received its shareholders' approval for raising capital of up to Rs 3,700 crore, including capital infusion by the government, through public issue and/or rights issue or private placement.

The city-based bank, which missed out capital infusion from the government last fiscal year, has sought above Rs 1,200 crore this fiscal year, according to sources.

Currently, the government holds a 60.13 per cent stake in the city-based lender.

In the March quarter, the bank's net profit dropped 23.48 per cent to Rs 443 crore from Rs 579 crore a year earlier. The dip in profit was on account of increase in tax outgo and on higher provisioning for bad loans.

However, for the full fiscal year, its net profit increased to Rs 1,782 crore from Rs 1,696 crore in FY14.

In the March quarter, its operating profit improved 25.2 per cent to Rs 1,652 crore from Rs 1,320 crore in the year-ago period.