United Bank of India was an Indian government-owned bank headquartered in Kolkata, India. Presently the bank has a three-tier organisational setup consisting of its head office in Kolkata, 36 regional offices and 2054 branches spread all over India. However, its major presence is in Eastern India. The bank has three full-fledged overseas branches, one each at Kolkata, New Delhi and Mumbai. United Bank of India now aims to expand its international activities. On 30 March 2009, the Indian government approved the restructuring of United Bank of India. The government proposed to invest 2.5 billion rupees in shares by 31 March and another 5.50 billion in the next fiscal year in Tier-I capital instruments. The move is part of the Indian government's program to improve the capital base of the state-owned banks. UBI gets SEBI approval for Rs 1,000 crore equity issue via QIP On 22 November 2017, United Bank of India said it has received SEBI's approval for issue of equity shares worth Rs 1,000 crore by way of institutional placement. On 1 April 2020, the bank along with Oriental Bank of Commerce has been merged with Punjab National Bank, making it as the second largest public sector bank in India.
History
UBI was the result of the merger in 1950 of four Bengali banks: Comilla Banking Corporation, Bengal Central Bank, Comilla Union Bank and Hooghly Bank. All four had suffered runs in December 1983 after the failure of the Nath Bank. The Reserve Bank of India assisted the banks in amalgamating to form United Bank of India. In 1961, UBI merged with Cuttack Bank and Tezpur Industrial Bank. Four years later, in 1965, the Government of Pakistan took over the bank's branches in Pakistan. On 19 July 1969, the Government of India nationalised UBI, along with 13 other major Indian commercial banks. At the time of nationalisation UBI had only 174 branches. In 1973, UBI acquired Hindustan Mercantile Bank. In 1976, UBI acquired Narang Bank of India, which had been established in 1943 in Narang, Gujarat.
Amalgamation
On 30 August 2019, Finance MinisterNirmala Sitharaman announced that United Bank and Oriental Bank of Commerce would be merged with Punjab National Bank. The proposed merger would make Punjab National Bank the second largest public sector bank in the country with assets of and 11,437 branches. MD and CEO of UBI, Ashok Kumar Pradhan, stated that the merged entity would begin functioning from 1 April 2020. The Union Cabinet approved the merger on 4 March 2020. Punjab National Bank announced that its board had approved the merger ratios the next day. Shareholders of Oriental Bank of Commerce and United Bank will receive 1,150 shares and 121 shares of Punjab National Bank, respectively, for every 1,000 shares they hold. The merge came into effect since 1 April 2020. Post merger, Punjab National Bank has become the second largest public sector bank in India
Controversy over Non-performing Assets (NPAs)
In February 2014, an RBI-appointed forensic audit by Deloitte found serious lapses in the Non-performing asset detection system of the bank. It is yet to be established whether this oversight on the part of the bank was deliberate or unintentional. The bank has reported a loss of Rs. 1,238 crore during Q3 of the 2013-14 fiscal year, resulting in a downgrade of its tier-II bonds by ICRA, an associate of Moody's Investor Service. United Bank of India's reported NPA of 10.82% is the highest in percentage among listed banks in India.
