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As the 83-year-old Union Bank of India dangles the IPO bait and decides to give thrust on retail banking, it is making all efforts to strengthen its position in the rapidly changing banking industry.
A profusion of long-awaited IPOs is hitting the Indian primary market as many companies have queued up to go public. In particular, the banking sector is on an IPO spree, following pressure from regulatory authorities. While the RBI has pressed private banks like IDBI, UTI Bank and Lord Krishna Bank to reduce promoters' equity to 40%, SEBI has held talks with major public sector banks to hasten their public offers as part of efforts to boost the capital market.
The success of the Punjab National Bank's IPO, and its successful run in the secondary market post-listing, was just the trigger public sector banks were waiting for. Since then, five of them have announced their IPO plans. At present, 11 state-owned banks are listed, with Union Bank of India, one of the oldest banks in the country, being the latest to join the league with its IPO.
Union Bank of India, is the sixth largest PSU bank. After its nationalization in 1975, three private sector banks have been merged with Union Bank of India, the latest being Sikkim Bank, which was merged with it in 1991. The bank has since come a long way crossing the Rs. 10,000 cr business mark in 1991 and Rs. 50,000 cr mark by 2000. Now, the bank has crossed another milestone, having garnered a business mix of Rs. 60,000 cr.
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