Union Bank of India has raised Rs 850 crore by issuing Basel-III-compliant tier-II bonds, which are in the nature of debentures eligible for inclusion in tier-II capital, on a private placement basis. Tier-II capital of a bank includes undisclosed reserves, revaluation reserves, and subordinate debt.
To comply with Basel-III capital regulations, banks globally need to improve and strengthen their capital planning processes in the aftermath of the Lehman Brothers failure. These norms are being implemented to mitigate concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks.
Union Bank of India is one of the largest government-owned banks of India. The Bank offers products and services in three categories - Deposits, Loans and Advances, and Remittances & Collections.
