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Mumbai , Sept. 18

UNION Bank of India's Rs 400-crore Tier-II capital bond issue has been oversubscribed to the extent of Rs 1,301 crore, the bank has informed the Bombay Stock Exchange.

The subordinated debt bonds issue, with a greenshoe option of Rs 400 crore, opened on September 14 and closed on September 15.

Of the bids received, Rs 896 crore were under the fixed rate option and Rs 405 crore under floating rate. The bank retained Rs 600 crore at a cut-off yield of 7.45 per cent per annum under fixed rate and Rs 200 crore at a cut-off yield of 55 basis points over one-year G-Sec under floating rate. The bank is raising funds to maintain its capital adequacy ratio (CAR) at 12 per cent, said a senior official of the bank. "By the end of this fiscal we are expecting advances of around Rs 50,000 crore. So, we need additional capital to maintain our CAR," he said.

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