Scribd
Upload
145 views2 pages

Assignment Banking, Insurance and Financial Services BASEL Norms Analysis of Union Bank

Union Bank of India is one of India's largest government-owned banks. In 2020, it became the fourth largest bank in India after merging with Corporation Bank and Andhra Bank. Union Bank was founded in 1919 and has over 9,500 branches today, including some overseas. As per RBI Basel III guidelines, banks must maintain a Tier 1 capital ratio of 7%, Tier 2 ratio of 2%, and CRAR of 11.5%. An analysis of Union Bank's capital ratios from 2019-2020 shows it complies with and exceeds these requirements, with a Tier 1 ratio around 10%, Tier 2 ratio above 2%, and CRAR above 11.5%.

Uploaded by

somya mathur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
145 views2 pages

Assignment Banking, Insurance and Financial Services BASEL Norms Analysis of Union Bank

Union Bank of India is one of India's largest government-owned banks. In 2020, it became the fourth largest bank in India after merging with Corporation Bank and Andhra Bank. Union Bank was founded in 1919 and has over 9,500 branches today, including some overseas. As per RBI Basel III guidelines, banks must maintain a Tier 1 capital ratio of 7%, Tier 2 ratio of 2%, and CRAR of 11.5%. An analysis of Union Bank's capital ratios from 2019-2020 shows it complies with and exceeds these requirements, with a Tier 1 ratio around 10%, Tier 2 ratio above 2%, and CRAR above 11.5%.

Uploaded by

somya mathur
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

ASSIGNMENT

Banking, Insurance and Financial Services


BASEL Norms Analysis of Union Bank

Union Bank of India is one of the largest Indian government-owned banks. It is under


the ownership of Ministry of Finance , Government of India with 120+ million customers and a total business
of US$106 billion.[2] After the amalgamation with Corporation Bank and Andhra Bank, which came into effect
on 1 April 2020, the amalgamated entity becomes the fourth largest bank in terms of branch network. UBI
now has around 9500 branches after the amalgamation. Four of these are overseas in Hong Kong, Dubai,
Antwerp, and Sydney. UBI also has representative offices at Shanghai, Beijing and Abu Dhabi. Lastly, UBI
operates in the United Kingdom through its wholly owned subsidiary, Union Bank of India (UK). Union Bank of
India was the anchor bank for both Andhra Bank and Corporation Bank, which came into effect on 1 April
2020 as announced by finance Minister of India Nirmala Sitharaman.

Union Bank of India (Union Bank) was registered on 11 November 1919 as a limited company in Mumbai and
was inaugurated by Mahatma Gandhi. At the time of India's independence in 1947, Union Bank of India had
four branches – three in Mumbai and one in Saurashtra, in trade centres. By the time the Indian
government nationalized Union Bank of India in 1969, it had 240 branches. In 1975, Union Bank of India
acquired Belgaum Bank, a private sector bank established in 1930 that had itself merged in a bank in 1964,
the Shri Jadeya Shankarling Bank (Bijapur; incorporated on 10 May 1948). Then in 1985 Union Bank of India
acquired Miraj State Bank, which had been established in 1929, and which had 26 branches.
Union Bank expanded internationally in 2007 with the opening of offices in Abu Dhabi, United Arab Emirates,
and Shanghai in the People's Republic of China. The next year, Union Bank established a branch in Hong
Kong, its first branch outside India. In 2009, Union Bank opened a representative office in Sydney, Australia.

RBI Guidelines
As per Basel norms iii it is required for bank to maintain:-
Tier 1 7%
Tier 2 2%
CRAR 11.5%(9 + 2.5% Capital Conservation
Buffer)
Liquidity Coverage Ratio 100%

Below given is the data of UNION Bank for 2019-20


2019 2020
 As per the Data the Tier I Capital is maintained between 9.48 %-10.47%, we can clearly
say that it has increased with year from 2019 to 2020 alson the bank bank able to
maintained the capital requirement as per the RBI Basel Norms which is 7%.
 The Tier II Capital is between 2.30%- 2.06% which is atleast and also a bit more than the
percentage issued by RBI guidelines.
 Now considering CRAR not only it is maintained in 2019 i.e. 11.78% it is also increasing
in 2020 i.e. 12.81% and also 2 percent more than the required percentage as per the
guidelines of RBI i.e. 11.5%.

Submitted By – SOMYA MATHUR (2020061)

You might also like