Union Bank of India shares fall 7.5% despite profit rise
NII declines 1% YoY, provisions jump 3x impacting sentiment
Asset quality improves, dividend of ₹5 announced for FY2
Shares of Union Bank of India declined sharply on Thursday after the lender reported a drop in its core income for the March quarter (Q4 FY26), offsetting gains from higher profit and improved asset quality.
The stock fell as much as 8.35% and was trading around ₹177.45 in afternoon trade, following the earnings announcement. The stock had recently touched a 52-week high of ₹205.49 and remains up about 11% over the past one month.
1 April 2026
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Net interest income (NII), a key measure of core earnings, declined 1.1% year-on-year to ₹9,406 crore from ₹9,514 crore in the same quarter last year, weighing on investor sentiment.
Net profit, however, rose 6.6% YoY to ₹5,316 crore from ₹4,985 crore, supported by growth in advances and stable margins.
Asset Quality Improves, But Slippages Rise
The bank reported an improvement in asset quality on a sequential basis. Gross non-performing assets (NPAs) declined to 2.82% from 3.06% in the December quarter, while net NPAs remained largely stable at 0.48% compared to 0.51%.
However, fresh stress remained elevated. Slippages rose to ₹2,023 crore during the quarter from ₹1,660 crore in the previous quarter, while total slippage additions stood at ₹2,102 crore compared to ₹1,853 crore sequentially.
Provisions also increased sharply to ₹1,055 crore, more than three times the ₹322 crore reported in the December quarter, indicating higher provisioning requirements.
Business Growth Remains Steady
On the business front, global advances grew nearly 10% year-on-year to ₹10.78 lakh crore, while global deposits increased 2.7% to ₹13.06 lakh crore.
The bank continued to see strong traction in its Retail, Agriculture and MSME (RAM) segments, which grew 12.56% YoY. Within this, retail advances rose 16.75% and MSME advances increased 18.75%. The RAM segment accounted for 57.49% of domestic advances.
Capital adequacy remained strong, with the CRAR at 18.10% as of March 31, 2026, while the CET-1 ratio improved to 15.69% from 14.98% a year ago.
Return ratios were stable, with return on assets (RoA) at 1.25% and return on equity (RoE) at 15.86% for FY26.
The bank's board recommended a dividend of ₹5 per equity share of face value ₹10 for FY26, subject to shareholder approval at the upcoming annual general meeting.
