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Indian Express
7 hours ago
- Business
- Indian Express
PSBs pocketed almost Rs 9,000 crore over 5 years for minimum balance non-maintenance
Even as a number of banks are announcing the waiving off of charges on non-maintenance of minimum balances, the finance ministry on Tuesday informed the Parliament that public sector banks (PSBs) collected almost Rs 9,000 crore as penalties on the same over a five-year period. According to data shared by Minister of State for Finance Pankaj Chaudhary in response to a question in the Rajya Sabha, state-owned lenders collected Rs 8,932.98 crore as penal charges on non-maintenance of minimum Average Monthly Balance in the five years starting 2020-21 and up to 2024-25. The data shared by the finance ministry on Tuesday comes days after Union Bank of India joined a host of other PSBs in waiving off penalties on non-maintenance of minimum balances, an issue that has been a sensitive one for some time. 'This move is aimed at ensuring uniformity, fairness, and enhancing accessibility of basic banking services to customers,' Union Bank of India said last week. Other PSBs that have ended these charges from the ongoing quarter include Canara Bank, Bank of Baroda, Punjab National Bank, Indian Bank, Bank of India, and Central Bank of India, the finance ministry said on Tuesday. The country's largest lender, State Bank of India, has not levied non-maintenance penalties since March 2020. 'The Department of Financial Services (DFS) has advised banks to examine the issue of rationalisation of penal charges for non-maintenance of Minimum Average Balance (MAB), with specific emphasis on providing relief to customers in semi-urban and rural areas,' Chaudhary further told the Rajya Sabha on Tuesday. As per the data shared by the Minister of State for Finance, Indian Bank garnered a fifth of all these penalties over the five-year period, amounting to Rs 1,828.18 crore. Punjab National Bank was in second place with Rs 1,662.42 crore, while Bank of Baroda rounded off the top-three with Rs 1,531.62 crore worth of fines collected from customers who did not maintain a certain minimum amount of funds in their accounts. After PSBs collected Rs 1,142.13 crore as penalties for non-maintenance of minimum balances in 2020-21, the amount rose sharply by 25 per cent in 2021-22, 30 per cent in 2022-23, and 26 per cent in 2023-24 to Rs 1,428.53 crore, Rs 1,855.43 crore, and Rs 2,331.08 crore, respectively. However, there was a slight decline of 7 per cent in 2024-25 to Rs 2,175.81 crore. The waiving off of minimum balance non-maintenance charges by several PSBs comes at a time when they have faced pressure on their current account, savings account ratios, which are the cheapest source of funds for banks. In its most recent Financial Stability Report, released in June, the Reserve Bank of India (RBI) noted that 'banks' liability profile is changing with the share of higher-cost term deposits and CDs (certificates of deposit) growing compared to low-cost current account and savings account (CASA) deposits.' State Bank of India, which has not been levying these non-maintenance charges for more than five years, has seen its move aid first-time account holders. Siddharth Upasani is a Deputy Associate Editor with The Indian Express. He reports primarily on data and the economy, looking for trends and changes in the former which paint a picture of the latter. Before The Indian Express, he worked at Moneycontrol and financial newswire Informist (previously called Cogencis). Outside of work, sports, fantasy football, and graphic novels keep him busy. ... Read More
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Business Standard
5 days ago
- Business
- Business Standard
Union Bank of India waives charges for non-maintenance of minimum balance
Union Bank of India has announced a complete waiver of charges for not maintaining the minimum balance in general savings deposit accounts, effective from the quarter-ending September, the bank said in a press note. 'This move is aimed at ensuring uniformity, fairness, and enhancing accessibility of basic banking services to customers. We are committed to supporting inclusive growth and believe this step will further strengthen our engagement with the underserved segment of the population,' the bank said. However, the waiver is not applicable to other customized products of savings accounts. Earlier, the charges for non-maintenance of minimum balance in accounts opened under the Pradhan Mantri Jan Dhan Yojana, and savings accounts of pensioners and senior citizens were already removed. Previously, several other banks, such as State Bank of India (SBI), Indian Bank, Canara Bank, Punjab National Bank, and Bank of Baroda, had waived charges for not maintaining minimum balance in savings accounts.
Time of India
6 days ago
- Business
- Time of India
India's top LNG importer Petronet seeks $1.4 bn local loan
India's largest importer of natural gas Petronet LNG Ltd. is seeking a loan of at least 120 billion rupees ($1.4 billion) for a new petrochemical plant and an LNG terminal , according to people familiar with the matter. Local lenders including Axis Bank , State Bank of India and Union Bank of India are considering to join the facility, which is among the company's largest fundraising exercises, said the people, who asked not to be identified discussing private matters. The borrower is seeking bids from banks in groups or individually, they said, adding that SBI Capital Markets has been appointed as adviser for the deal. The facility for triple-A rated Petronet comes at a period of muted activity for India's loans space, where bank lending grew 9.5% as of June 27, the lowest growth rate since March 2022, according to the latest data from the Reserve Bank of India. If the financing goes through, it would be one of the biggest local currency loans for the country this year, according to Bloomberg-compiled data. Spokespeople for Axis Bank , Petronet, SBI, SBI Capital Markets and Union Bank of India didn't immediately reply to emails from Bloomberg News seeking comment. Proceeds from the loan will partially fund the construction of a new petrochemical complex in Dahej, located in the southwest coast of Gujarat in India, the people said, adding that it will help diversify the company's earnings beyond the LNG space. The project is estimated to cost 206.85 billion rupees, according to the company's website. The New Delhi-based firm is also setting up a separate five million tons land-based LNG import terminal at Gopalpur, located on the east coast in Odisha. The latest loan could carry a tenor of more than 10 years, the people said. The pricing could be lower than SBI's one-month marginal cost of funds based lending rate of 7.95% currently, a benchmark gauge of local currency borrowings, two of the people said.
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Business Standard
6 days ago
- Business
- Business Standard
Petronet seeks $1.4 bn loan to fund petrochemical plant, LNG terminal
By Saikat Das and Rakesh Sharma India's largest importer of natural gas Petronet LNG Ltd. is seeking a loan of at least 120 billion rupees ($1.4 billion) for a new petrochemical plant and an LNG terminal, according to people familiar with the matter. Local lenders including Axis Bank, State Bank of India and Union Bank of India are considering to join the facility, which is among the company's largest fundraising exercises, said the people, who asked not to be identified discussing private matters. The borrower is seeking bids from banks in groups or individually, they said, adding that SBI Capital Markets has been appointed as adviser for the deal. The facility for triple-A rated Petronet comes at a period of muted activity for India's loans space, where bank lending grew 9.5per cent as of June 27, the lowest growth rate since March 2022, according to the latest data from the Reserve Bank of India. If the financing goes through, it would be one of the biggest local currency loans for the country this year, according to Bloomberg-compiled data. Spokespeople for Axis Bank, Petronet, SBI, SBI Capital Markets and Union Bank of India didn't immediately reply to emails from Bloomberg News seeking comment. Proceeds from the loan will partially fund the construction of a new petrochemical complex in Dahej, located in the southwest coast of Gujarat in India, the people said, adding that it will help diversify the company's earnings beyond the LNG space. The project is estimated to cost 206.85 billion rupees, according to the company's website. The New Delhi-based firm is also setting up a separate five million tons land-based LNG import terminal at Gopalpur, located on the east coast in Odisha. The latest loan could carry a tenor of more than 10 years, the people said. The pricing could be lower than SBI's one-month marginal cost of funds based lending rate of 7.95per cent currently, a benchmark gauge of local currency borrowings, two of the people said.
Business Standard
21-07-2025
- Business
- Business Standard
Union Bank of India slides after Q1 PAT declines 17% QoQ to Rs 4,116 cr
Union Bank of India slipped 1.75% to Rs 143.45 after the bank's net profit fell 17.44% to Rs 4,115.53 crore on a 4.49% decline in total income to Rs 31,781.34 crore in Q1 FY26 over Q4 FY25. On a year-on-year (YoY) basis, net profit jumped 11.87%, while total income rose 2.94% in Q1 FY26. Net interest income (NII) slipped 3.18% to Rs 9,113 crore in the June 2025 quarter, compared to Rs 9,412 crore in the June 2024 quarter. For Q1 FY26, the net interest margin (NIM) was 2.76%, down from 3.05% in the corresponding period last year. Profit before tax (PBT) grew 4.96% YoY to Rs 5,244.15 crore in the quarter ended 30 June 2025. The bank's operating profit before provisions and contingencies fell 11.26% to Rs 6,908.66 crore in the June 2025 quarter, compared to Rs 7,785.31 crore in the same quarter the previous year. On the asset quality front, gross non-performing assets (GNPA) stood at Rs 34,311.31 crore as of 30 June 2025, down 17.16% from Rs 41,422.94 crore as of 30 June 2024. The gross NPA ratio stood at 3.52% as of 30 June 2025, compared to 4.54% as of 30 June 2024. The net NPA ratio stood at 0.62% as of 30 June 2025, down from 0.90% as of 30 June 2024. The banks capital adequacy ratio as of 30 June 2025, as per Reserve Bank of India (RBI) guidelines under Basel III norms, was 18.84%, with a Tier-1 capital adequacy of 15.86%. Total business of the bank increased by 5.01% YoY, with gross advances rising 6.83% YoY and total deposits growing 3.63% YoY. The bank had total business of Rs 22,14,422 crore as of 30 June 2025. Global deposits have increased by 3.63% YoY. The bank now has a total deposit base of Rs 12,39,933 crore as of 30 June 2025. The RAM segment of the bank increased by 10.34% YoY, with in which 25.63% growth in retail and 17.65% growth in MSME advances were achieved on a YoY basis. RAM advances as a percentage of domestic advances stood at 58.11%. The CRAR improved from 17.02% as of 30 June 2024 to 18.30% as of 30 June 2025. The CET-1 ratio rose from 13.81% to 15.30% over the same period. The banks return on assets (ROA) and return on equity (ROE) stood at 1.11% and 15.15%, respectively, during Q1 FY26. Union Bank of India is one of the leading public sector banks in the country. The Government of India holds 74.76% of the bank's total paid-up capital. The bank has 8,649 branches, including foreign branches, over 8,900 ATMs, more than 73,500 employees, and over 23,000 BC points.
