The merged entity will be 5th largest PSU bank in India
In a press briefing today, finance minister announced that Union Bank of India, Andhra Bank and Corporation Bank will be merged. The entity will be fifth largest public sector bank with business of Rs 14.59 lakh crore.
The entity will have fourth largest branch network in India with 9,609 branches.
The scale and synergy will benefit through large cost reduction potential due to network overlaps. Business will become twice to 4-1/2 times existing bank business. Cost saving and income opportunities will arise for JVs and subsidiaries.
All three banks share a common CBS (core banking software), Finacle, which will enable quick realisation of gains.
The finance minister has announced the upfront capital infusions of Rs 55250 crore into 10 public sector banks. As per the proposal, Union Bank is being allocated Rs 11700 crore.
Shares of Union Bank of India slumped 5.94% to Rs 55.4 at 11:56 IST on BSE. The stock hit a high of Rs 59.4 and a low of Rs 54.9 so far during the day. The stock hit a 52-week high of Rs 100.3 on 03 Apr 2019. The stock hit a 52-week low of Rs 57.6 on 23 Aug 2019.
On the BSE, 8.26 lakh shares were traded in the counter so far compared with average daily volumes of 6.07 lakh shares in the past two weeks. Union Bank of India has underperformed the market in past one year, falling 32.18% as against Sensex's 4.27% fall.
Shares of Andhra Bank added 1.77% to Rs 20.15 at 11:56 IST on BSE. The stock hit a high of Rs 20.8 and a low of Rs 19.7 so far during the day. The stock hit a 52-week high of Rs 35.7 on 03 Sep 2018. The stock hit a 52-week low of Rs 17.2 on 23 Aug 2019.
On the BSE, 1.07 lakh shares were traded in the counter so far compared with average daily volumes of 48,000 shares in the past two weeks. Andhra Bank has underperformed the market in past one year, falling 43.32% as against Sensex's 4.27% fall.
Shares of Corporation Bank fell 1.59% to Rs 18.55 at 11:56 IST on BSE. The stock hit a high of Rs 22.3 and a low of Rs 17.1 so far during the day. The stock hit a 52-week high of Rs 32.15 on 27 Feb 2019. The stock hit a 52-week low of Rs 16.9 on 26 Aug 2019.
On the BSE, 97,000 shares were traded in the counter so far compared with average daily volumes of 27,000 shares in the past one quarter. Corporation Bank has underperformed the market in past one year, falling 31.04% as against Sensex's 4.27% fall.
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