Union Bank of India has received a significant interim distribution of USD 18.37 million from the liquidation of its Malaysian joint venture. The bank disclosed this development to stock exchanges, under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Joint Venture Liquidation Details

The funds represent Union Bank's 25% share from the Members Voluntary Liquidation (MVL) of India International Bank Malaysia (IIBMB). This distribution constitutes capital repatriation from the liquidation process of the Malaysian banking entity.

Joint Venture Structure

India International Bank Malaysia was established as a collaborative venture between three major Indian public sector banks. The partnership brought together significant banking expertise and capital from the Indian financial sector to serve the Malaysian market.

Regulatory Compliance

The disclosure was made in compliance with SEBI's listing regulations, ensuring transparency for shareholders and market participants. Union Bank's Company Secretary Mangesh Mandrekar signed the official communication to both BSE and NSE, maintaining proper regulatory protocols throughout the process.

This interim distribution represents a positive development for Union Bank, providing capital repatriation from its international operations as the Malaysian joint venture concludes its liquidation process.

Union Bank of India received credit rating reaffirmations from CRISIL Ratings on December 11, 2025, with the rating agency maintaining its positive assessment of the public sector bank's financial strength and creditworthiness. The reaffirmation covers multiple debt instruments while reflecting the bank's improved operational performance and asset quality metrics.

Rating Actions and Instrument Details

CRISIL Ratings reaffirmed ratings on several key debt instruments while taking specific actions on others. The rating agency maintained its assessment across different categories of bonds with stable outlooks.

The withdrawal of rating on ₹1,000 crores of Tier-2 bonds was executed in line with CRISIL's withdrawal policy, following independent confirmation that these instruments were fully redeemed. All rating actions were verified on December 11, 2025.

Financial Performance and Asset Quality Improvement

The bank demonstrated significant improvement in asset quality metrics during the reporting period. Gross Non-Performing Assets (GNPA) showed a declining trend, reflecting enhanced recovery efforts and better credit management practices.

The improvement in GNPA stems primarily from the retail book and MSME segments, supporting overall asset quality metrics. Credit costs remained range-bound between 0.40%-0.50% of average total assets since fiscal 2024, indicating controlled provisioning requirements.

Capital Adequacy and Profitability Metrics

Union Bank maintained strong capital adequacy ratios well above regulatory requirements. The bank's capitalization benefited from equity infusion and strong internal accruals, providing adequate buffers for business growth.

The bank reported consolidated profit after tax of ₹8,419 crores for H1 FY26 compared to ₹8,322 crores in H1 FY25. For the full fiscal 2025, the profit was ₹17,922 crores against ₹13,708 crores in the previous fiscal, demonstrating sustained profitability improvement.

Operational Scale and Market Position

Union Bank maintains sizeable scale of operations with significant market presence in the domestic banking system. The bank holds a 4.00% share each in deposits and advances in the domestic banking system as of September 30, 2025.

The bank benefits from its extensive branch network and wide reach in rural and semi-urban areas, facilitating access to a stable resource base. Government ownership stood at 74.70% as of September 30, 2025.

Rating Rationale and Outlook

CRISIL's ratings factor in the expectation of strong support from the majority stakeholder, Government of India, along with the bank's adequate capital position and sizeable scale of operations. These strengths are partially offset by average, though gradually improving, asset quality and profitability metrics. The stable outlook reflects the rating agency's assessment that Union Bank should continue to benefit from strong government support and its large size and scale, while maintaining current asset quality levels going forward.