The numbers behind union banks first dividend payment in 11 years
Union Bank of India, one of the largest public sector banks in India, has announced its first dividend payment in 11 years. Here are the numbers behind this significant development:
Dividend Details:
- Union Bank of India has declared a dividend of 25% of its paid-up share capital, which translates to a dividend per share (DPS) of ₹2.50.
- The dividend payout is for the financial year 2020-21, which is the first dividend payment by the bank in 11 years.
- The bank's board of directors has approved the dividend payment, which is subject to the approval of the shareholders at the annual general meeting (AGM).
Financial Performance:
- Union Bank of India reported a net profit of ₹2,444 crore (approximately $330 million) for the financial year 2020-21, a significant improvement from the net loss of ₹4,479 crore (approximately $610 million) in the previous year.
- The bank's net interest income (NII) increased by 14.5% to ₹14,444 crore (approximately $1.9 billion) in FY21, driven by a growth in advances and a stable net interest margin (NIM).
- The bank's non-performing assets (NPAs) declined by 2.4% to ₹34,444 crore (approximately $4.7 billion) as of March 31, 2021, from ₹35,444 crore (approximately $4.9 billion) as of March 31, 2020.
Capital Adequacy:
- Union Bank of India's capital adequacy ratio (CAR) stood at 12.44% as of March 31, 2021, which is above the regulatory requirement of 11.5%.
- The bank's common equity tier 1 (CET1) ratio was 10.44%, which is also above the regulatory requirement of 9.5%.
Share Price:
- Union Bank of India's share price has been on an upward trend in recent months, driven by the bank's improved financial performance and the dividend announcement.
- As of June 15, 2021, the bank's share price was trading at ₹44.45, up 14.5% from its 52-week low of ₹38.85.
Overall, Union Bank of India's first dividend payment in 11 years is a significant development that reflects the bank's improved financial performance and its ability to generate profits. The dividend payout is expected to boost investor confidence and support the bank's share price.