Union Bank's elevated credit costs, bad loans to hit capital position: S&P

Weak performance in FY19 on expected lines

Union Bank of India's elevated credit costs and provisions for bad loans will continue to weigh on its earnings profile, adversely impacting capital position, said global rating agency Standard and Poor's.

The public sector lender posted a sharp rise in net loss in the fourth quarter of the year ended March 2019 (Q4FY19) on higher provisions as the Reserve Bank of India asked it to reclassify non-performing assets (NPAs) from back date.

The bank's reported coverage ratio for NPAs has improved to 58 per cent as on March 31, 2019, from 51 per cent a year ago. But, Union Bank