Brickwork Ratings has reaffirmed the ratings for Union Bank’s Tier II Bonds (under Basel III) and Additional Tier I Bonds (under Basel III). The ratings for Tier II Bonds are reaffirmed at BWR AAA/Stable, and the ratings for Additional Tier I Bonds are reaffirmed at BWR AA+/Stable. This action reflects Union Bank’s strong capital position and improving asset quality.
Ratings Reaffirmed
Brickwork Ratings (BWR) has reaffirmed the credit ratings for Union Bank of India’s Tier II Bonds (under Basel III) amounting to Rs. 1000 Crs and Additional Tier I Bonds (under Basel III) amounting to Rs. 1705 Crs.
Detailed Ratings
The following ratings have been reaffirmed:
- Tier II Bonds (under Basel III): BWR AAA/ Stable
- Additional Tier I Bonds (under Basel III): BWR AA+/ Stable
Factors Supporting the Ratings
The rating affirmations reflect several key strengths of Union Bank:
- Strong Capital Position: The bank maintains a healthy capital position supported by internal accruals. As of June 30, 2025, the total capital to risk weighted asset ratio (CRAR) stood at 18.30%, with a Tier-1 Ratio of 16.58% and a CET-1 Ratio of 15.30%.
- Government Support: The bank benefits from the strong support of its promoter, the Government of India (GOI), which holds a 74.76% stake as of June 30, 2025.
- Improved Asset Quality: The bank’s asset quality is improving, as reflected in the Gross NPA and NNPA Ratios.
Financial Highlights (Q1 FY26)
Key financial indicators for Q1 FY26 include:
- Total Business: Rs. 22,14,422 Crs
- Gross NPA: 3.52%
- Net NPA: 0.62%
- Net Profit: Rs. 4,116 Crs
- CRAR: 18.30%
Source: BSE