Union Bank okays merger of Andhra, Corp Bank with itself

New Delhi: Union Bank of India on Monday said its board of directors has approved merger of Andhra Bank and Corporation Bank with itself and given nod for a capital infusion of Rs 17,200 crore in the current financial year.

The decision was taken at the meeting of the board of directors held on Monday, the bank said in a regulatory filing. The board "considered and given its in-principle approval for the amalgamation of Andhra Bank and Corporation Bank into Union Bank. And, (the board also) approved the revised capital plan for 2019-20 to raise capital funds by an amount not exceeding Rs 17,200 crore within which up to Rs 13,000 crore through equity capital and up to Rs 4,200 crore through additional tier 1/2 bonds," it said.

The bank added that the board has okayed capital raising by issue of equity shares through preferential allotment to the government for an amount up to Rs 13,000 crore, subject to other regulatory approvals.

Finance Minister Nirmala Sitharaman had on August 30 announced a mega merger of public sector banks, whereby the number of such banks would now come down to 13 from 19 at present. In the latest round, as many as 10 banks will be merged into four banks.