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Target: ₹50
CMP: ₹43
The MD and CEO, Executive Directors, and other top management of Union Bank of India highlighted the various initiatives undertaken by the bank to: improve the underwriting standards; increased focus on speedy and timely resolution of stressed assets; better monitoring of the SMA book and; higher focus on recoveries, with a target to pare down the GNPA/NNPA ratio to less than 9 per cent/2.9 per cent by FY23.
The bank has segregated and shifted the loan portfolio to dedicated verticals for a recovery and follow-up.
The bank saw recoveries of ₹3,800 crore and is on track to achieve total recoveries of ₹15,000 crore in FY23. The bank has formed a Stressed Asset Management (SAM) department for large ticket-size loans. It has a total of nine such centres handling loans of ₹1-lakh crore. It has 19 ARBs handling loans, with an exposure of ₹1 crore - ₹ 25 crore, and is currently handling loans worth ₹14,000 crore.
Total standard restructuring book stands at ₹16,700 crore, of which ₹4,500 crore appears to be stressed. MSMEs may witness some stress, but the same will not impact overall asset quality.
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