Union Bank Approves ₹8,000 Crore Fundraising Plan Via Equity And Debt

State-owned Union Bank of India on Tuesday approved plans to raise up to ₹8,000 crore through a mix of equity and debt instruments, as the lender looks to strengthen its capital base and support future business growth.

The decision was cleared at the bank’s board meeting held on 26 May 2026, according to a regulatory filing with the stock exchanges.

Following the announcement, Union Bank shares remained under pressure in trade. The stock was quoted at ₹167.55 apiece on the Bombay Stock Exchange, down 0.83% from the previous close.

₹3,000 Crore Equity Raise Through Multiple Routes

Under the approved plan, Union Bank will raise up to ₹3,000 crore through equity capital and up to ₹5,000 crore through debt instruments, taking the total proposed fundraising to ₹8,000 crore.

The equity component of ₹3,000 crore may be raised in one or more tranches through multiple routes, including:

• Further Public Offer (FPO)

• Rights Issue

• Qualified Institutions Placement (QIP)

• Preferential Allotment

• Other private placement options

The bank said the fundraising will be subject to approvals from shareholders, regulators, and the Government of India, wherever required.

₹5,000 Crore Debt Plan Through Basel III Bonds

For the debt portion, the board approved raising up to ₹5,000 crore via Basel III-compliant Additional Tier 1 (AT1) bonds and/or Tier 2 bonds. Reports also indicated that the lender may consider foreign currency-denominated bond issuances under private placement routes as part of this debt raising programme.

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The capital raising plan comes at a time when public sector lenders are focusing on maintaining healthy capital adequacy ratios amid continued credit growth and regulatory requirements.

Sources:

Economic Times

Business Standard