State-run Union Bank of India on Tuesday approved plans to raise up to Rs 8,000 crore through a mix of debt and equity instruments, according to a report by PTI. The bank's board, in a regulatory filing to the BSE, gave the green light for raising debt capital of up to Rs 5,000 crore through Basel III-compliant Additional Tier-1 bonds and/or Tier-2 bonds. Additionally, the board approved raising Rs 3,000 crore through equity issuance in phases, within the overall Rs 8,000 crore limit.
Capital Raising Details
The equity component may be raised through a public issue, including a Further Public Offer (FPO), rights issue, or private placements such as Qualified Institutional Placements (QIP) and preferential allotments, the filing said. The bank stated, "The board of directors, in its meeting held on May 26, 2026, considered and approved the plan of the bank to raise capital by an amount not exceeding Rs 8,000 crore."
Market Reaction
Shares of Union Bank of India were trading at Rs 167.25 on the BSE, down 1.01 per cent from the previous close. The capital raising plan is aimed at strengthening the bank's capital base to support growth and meet regulatory requirements.
The move comes as part of the bank's strategic efforts to bolster its financial position amid evolving market conditions. Union Bank of India, a public sector lender, has been focusing on enhancing its capital adequacy ratio to comply with Basel III norms and support lending activities.
Analysts view the capital raising plan positively, as it will provide the bank with additional resources to expand its business and improve asset quality. The mix of debt and equity instruments allows the bank to optimize its capital structure while managing costs.
