UBI justifies govt action to ward of global crisis
By chennaivision at 13 January, 2009, 10:57 am
Kozhikode, Jan 12Â The Union Bank of India (UBI) today justified action taken by the Centre, Reserve Bank of India (RBI) and the banking sector to mitigate the impact of the global financial crisis on the country.
Being the fifth largest economic power in the world, the global meltdown would naturally affect India but timely action by the RBI to infuse Rs 260,000 crore liquidity into the banking sector had helped ward of the crisis to certain extend, UBI Chairman and Managing Director M V Nair told reporters here.
After initiating the steps, financial situation was encouraging during the last two months but 2009-10 would be a challenging year as the real effect of the crisis would be felt during the period, Mr Nair, who was here to open a UBI branch at Kottakkal in Malappuram district, said.
On Satyam issue, he said since confidence in the corporate sector had taken a beating because of the fraud, immediate steps should be initiated to restore investors’ trust.
Mr Nair said UBI had achieved an impressive result for nine months ending December 2008 with a total business of Rs 222,861 crore on a year on year growth of 28.47 per cent.
The bank’s deposists have touched Rs 129,596 crore registering a YOY growth of 30.60 per cent and the advances reached Rs 93,266 crore with a growth of 25.61 per cent, he said.
Mr Nair said the bank’s focus throughout the year had been on core deposits resulting in the share of high-cost wholesale deposits declining from 21.72 per cent in March 2008 to 14.66 per cent in December 2008.
The core deposits as in December 2008 stood at Rs 108,449 crore marking a YOY growth of 35.02 per cent.
As part of its diversification plan, he said the UBI had entered into an agreement with Bank of India and Dai-chi Mutural Life Insurance Company of Japan to set up a joint venture life insurance company.
Titled ”Star Union Dai-chi Life Insurance Company Limited,” it would have an initial paid-up capital of Rs 150,000 crore which would subsequently be raised to Rs 250,000 crore.
UBI has also entered into a strategic alliance with KBC Asset Management of Belgium to form a joint venture asset management firm with stakes of 50 per cent and 49 per cent respectively, he added.
UNI
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