The Hindu Business Line : Post-write off, United Bank plans revamp

The Union Government's decision to write off United Bank of India's (UBI) accumulated loss of Rs 278.44 crore has come as a big relief to bank management.

"It is a positive development", Mr P.K. Gupta, CMD of the bank, told Business Line, pointing out that the bulk of its loss had already been adjusted against profits earned in earlier years. Henceforth, the profits will become part of reserves, he said.

At one point, the bank's loss was as high as Rs 1,400 crore which had been brought down to the present level of Rs 278.44 crore by setting off against profits. "Compared to what the Government has allowed for several other banks, the amount to be written off in our bank is insignificant," Mr Gupta observed.

The present loss would be set off against the equity capital which will now come down to Rs 1,532.43 crore.

UBI, as the CMD informed, was yet to receive the official communication in this regard. Once it had been received, the exercise on setting off of the loss against the capital would start. It would be followed by restructuring exercise. There were various restructuring options such as part of the equity could be converted into preference shares or into long-term perpetual debt.

More Stories on : Restructuring | Public Sector Banks | Financial Policy

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Rupee flat against dollar

Disclosures to be must for insurers soon

Chidambaram welcomes monetary policy

ICICI Pru mulls `health-savings' product

Insurers get ready for deregulation of tariffs

Bonds down on profit-booking

Post-write off, United Bank plans revamp

Call rates unchanged at 5.5-5.6 pc

Canara Bank ups NRE deposit rates

Karnataka Bank NRE deposit rates

BoI signs pact with Exim Bank