Fitch Ratings has affirmed Union Bank of India’s National Long-Term Rating at AA+ (ind) with stable outlook. The rating agency has also affirmed AA+ (ind) rating to Rs 1,000 crore Lower Tier 2 bonds, Rs 300 crore Perpetual Tier 1 notes and Rs 1,000 crore Upper Tier 2 bonds of the company.
Union Bank’s national long-term rating is support-driven as there is high probability of support from the Government of India (GoI). However, the rating is a notch lower than its peers to reflect moderate credit matrices. Union Bank is India's seventh-largest public sector bank and 10th largest commercial bank by assets. The ratings of Union’s tier 1 bonds and upper and lower tier 2 bonds are based on Fitch's criteria for rating Indian national bank hybrids and subordinated debt.
The Bank’s net profit for the quarter increased by 16.19% at Rs 352.52 crore as compared to Rs 303.39 crore for the quarter ended September 30, 2010. Bank’s total income rose by 25.76% at Rs 5611.37 crore for the second quarter of the current fiscal from Rs 4461.88 crore for the corresponding quarter of the previous fiscal. The bank’s gross NPA has gone up at 3.49% for the quarter under review whereas the same was at Rs 2.79% for the September quarter of the previous fiscal.
