Union Bank of India will raise Rs 700 Cr from the sale of its stake in six companies

Union Bank of India will raise Rs 700 Cr from the sale of its stake in six companies

According to a sales document, the Union Bank of India has put up for sale its holdings in six companies to collect about 700 crores of rupees. The public sector lender has called for tenders for its 0.41% stake in the National Stock Exchange (NSE), 2.81% for the National Securities Depository (NSDL) and the NSDL eGovernance Infrastructure, 1 , 95% for the Small Development Development Bank of India (Sidbi), 1% in the Clearing Corporation of India (CCIL) and 4.15% in JM Financial ARC.

The deadline for sending tenders is 30 October.

In a bidding document, the bank said it would not accept bids in a price range. "Offers must relate to at least 50% of the shares of the company offered for sale by the Bank. The bidder may choose to request all or part of the shares offered for sale by the bank, "says the document.

In the quarter ended June, Union Bank generated 194 crore of investment sales, down 70.3% year-on-year and 47.3% sequentially.

Earlier this year, Baroda Bank (BoB), the Punjab National Bank (PNB), IDBI Bank, Dena Bank and Canara Bank sold their stakes in non-core assets.

The increase in bad debts has had a negative impact on the capital position of public sector banks (PSBs), causing them to dump their non-core assets. On September 25, the government declared that PSBs were offered 90,000 crores (including 80,000 crores in the form of bonds) in 2017-18 and that securities worth an additional 65,000 crores were would be provided in this fiscal year. Any new injection, if finally approved, before an election year could be done through recapitalization obligations – which will be the off-budget commitments of the government – to avoid a worsening budget deficit.

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