United Bank of India

United Bank of India

Company type	Government-owned
Industry	Banking, Financial services
Founded	1950 (1950)
Defunct	April 1, 2020 (2020-04-01)
Fate	Merged into Punjab National Bank
Area served	India
Key people	Ashok Kumar Pradhan (MD and CEO)
Products	Banking and financial services including ATMs with cash recycling, debit cards, online banking, mobile banking apps, prepaid cards, SMS banking, credit cards, UPI Bhim app
Parent	Government of India (before merger)

United Bank of India (UBI) was a government-owned Indian bank providing a range of banking and financial services. Established in 1950 with its headquarters in Kolkata, it became a nationalized institution in 1969 under the Indian government’s bank nationalization drive, emerging as an important public sector bank. On 1 April 2020, UBI was merged into Punjab National Bank along with Oriental Bank of Commerce.

History

The foundation of UBI traces back to the consolidation of four Bengal-based banks in 1950: Comilla Banking Corporation (initiated by Narendra Chandra Dutta in 1914), Bengal Central Bank (started by J. C. Das in 1918), Comilla Union Bank (founded by Indu Bhusan Dutta in 1922), and Hooghly Bank (established by D. N. Mukherjee in 1932). The collapse of Nath Bank in December 1938 triggered bank runs on these institutions, leading the Reserve Bank of India to orchestrate their merger.

In 1961, UBI extended its reach by incorporating Cuttack Bank (founded in 1913) and Tezpur Industrial Bank (founded in 1918 and recognized as Assam’s first commercial bank). In 1965, the Pakistani government took control of UBI’s branches located within Pakistan.

On 19 July 1969, UBI was brought under government ownership along with thirteen other major banks; at that point, it had a network of only 174 branches. Later expansions included the acquisition of Hindustan Mercantile Bank (established in 1944) in 1973 and Narang Bank of India (established in Gujarat in 1943) in 1976.

Amalgamation

On 30 August 2019, Finance Minister Nirmala Sitharaman declared the consolidation of United Bank and Oriental Bank of Commerce into Punjab National Bank. This strategic move made Punjab National Bank the country’s second largest public sector bank, boasting assets worth and a branch network comprising 11,437 outlets. Ashok Kumar Pradhan, MD and CEO of UBI, confirmed that the unified entity would commence operations from 1 April 2020. The merger received Union Cabinet approval on 4 March 2020, with Punjab National Bank’s board sanctioning share swap ratios: shareholders of Oriental Bank were allotted 1,150 shares and those of United Bank received 121 shares of PNB per every 1,000 shares held. The merger officially took effect on 1 April 2020.

Earlier, on 30 March 2009, the Indian government had sanctioned a restructuring plan for United Bank of India which included an investment of ₹2.5 billion through equity by the end of March and an additional ₹5.5 billion via Tier-I capital instruments during the next fiscal year to reinforce the capital base of state-owned banks. Subsequently, on 22 November 2017, UBI obtained SEBI approval for raising ₹1,000 crore through qualified institutional placement (QIP).

Following the merger's implementation on 1 April 2020, branches previously operating under United Bank of India and Oriental Bank of Commerce were integrated into Punjab National Bank’s network, cementing PNB’s status as India’s second largest public sector banking institution.

Controversy over Non-performing Assets (NPAs)

In February 2014, a forensic audit conducted by Deloitte at the behest of RBI uncovered serious deficiencies within the bank’s system for identifying Non-performing assets. It remains uncertain whether these failures were intentional or accidental.

During the third quarter of fiscal year 2013-14, United Bank reported losses amounting to ₹1,238 crore, which prompted ICRA—a Moody’s affiliate—to downgrade its tier-II bonds. At that time, UBI's NPA ratio was recorded at 10.82%, marking it as the highest among publicly listed banks in India.

Products Delivered Through Various Channels

• ATMs equipped with cash recycling functionality available at numerous branches
• A range of debit cards, including platinum and moments variants
• Online banking services
• Banking via mobile applications
• Prepaid card options
• SMS-based banking services
• United E-passbook mobile application
• United Wallet for payment of utilities
• United-branded credit card
• United UPI Bhim mobile application

See also

• United Bank of India (1866-1874)