United Bank proposes Rs 1,000 crore preferential issue

State-owned United Bank of India proposed a Rs 1,000-crore preferential issue to the government to meet its capital requirement and growth needs.

The board on Tuesday approved preferential allotment of equity to the Government of India as per SEBI regulation by fresh issue of equity shares aggregating up to Rs 1,000 crore subject to the necessary approval from the government and regulators, United Bank of India said in a filing on the BSE.

Besides, it has also cleared preferential allotment of equity to the Government of India by issuing perpetual non-cumulative preference shares of Rs 1,00,000 each aggregating Rs 525.23 crore.

The bank also obtained board approval for issuance and allotment of up to Rs 500 crore Basel III compliant perpetual debt instruments.

The bonds would be in the form of subordinated, nonconvertible, noncumulative, listed, Additional Tier-I bonds of Rs 10,00,000 each.

For the third quarter ended December 2014, United Bank of India posted net profit of Rs 41.78 crore as against a net loss of Rs 1,238.08 crore in the same quarter a year ago.

As far as bank's asset quality is concerned, gross NPAs as a percentage to total advances rose to 12.03% from 10.82% in the same quarter an year ago.

Its net NPAs went up to 8.50% from 7.44% at the end of December 2013, United Bank of India said in a statement.

Gross NPA in absolute terms, however, declined to Rs 7,809.38 crore as compared to Rs 8,545.50 crore at the end of December 2013.