1 Global Developments: Macroeconomic and Financial Market Environment :
The global economy remained resilient during 2025 despite a challenging backdrop of geopolitical tensions, trade fragmentation, fiscal pressures, and policy uncertainty. Global growth improved marginally to 3.4 per cent from 3.3 per cent in 2024, supported by easing inflation, robust services activity, technological investments, and improving financial conditions. Global trade volumes expanded by 5.1 per cent compared with 3.6 per cent in the previous year, reflecting a gradual recovery in merchandise trade and continued strength in services exports. At the same time, global inflation moderated to around 4.1 per cent, allowing several major central banks to initiate monetary easing cycles after an extended period of restrictive policy settings.
Despite these positive developments, financial markets remained highly volatile. Sovereign debt concerns, tariff measures, rising fiscal deficits in advanced economies, and geopolitical conflicts repeatedly triggered risk-off sentiment. Towards the latter part of FY2025-26, the outbreak of the West Asia conflict significantly worsened the global outlook by disrupting energy supply chains and heightening uncertainty. Crude oil prices rose sharply, sovereign bond yields hardened globally, and investors shifted towards safe-haven assets such as gold and the US dollar. Consequently, the IMF revised down its 2026 global growth forecast to 3.1 per cent. Emerging market economies also witnessed heightened volatility in capital flows, with equity outflows increasing amidst rising geopolitical risks.
2 India Economic Macro Overview:
Against this uncertain global backdrop, India continued to outperform most major economies and retained its position as the fastest-growing large economy globally. Real GDP growth accelerated to 7.6 per cent in FY2025- 26 (as per second advance estimate for GDP released in February 2026) from 7.1 per cent in the previous year, reflecting the strength of domestic demand and the resilience of economic fundamentals. Private consumption, which constitutes nearly 60 per cent of GDP, expanded by 7.7 per cent compared with 5.8 per cent a year earlier, supported by improving rural demand, moderation in inflation, tax relief measures, rising employment, and higher disposable incomes. Government consumption also remained supportive, growing by 6.6 per cent.
Investment activity remained robust with gross fixed capital formation expanding by 7.1 per cent. Public capital expenditure continued to crowd in private investment, while indicators such as capital goods imports, cement production, and steel consumption pointed towards sustained investment momentum. Importantly, despite higher tariffs imposed by the United States and slowing global trade, net exports exerted only a marginal drag of 0.1 percentage point on GDP growth, highlighting the economys increasing reliance on domestic demand.
On the supply side, Gross Value Added (GVA) grew by
7.7 per cent. Manufacturing emerged as the principal growth engine, expanding by a strong 11.5 per cent, aided by improved corporate profitability, stronger capacity utilisation, and infrastructure spending. Services growth remained robust at 8.7 per cent, led by trade, transportation, financial services, and professional services. Agriculture, while moderating to
2.4 per cent growth, continued to benefit from favourable monsoon conditions and record foodgrain production. Macroeconomic fundamentals strengthened further, with gross domestic savings rising to 34.2 per cent of Gross National Disposable Income (GNDI) from 32.3 per cent a year ago. Household financial savings improved significantly to 7.0 per cent of GNDI, while household financial liabilities declined, indicating stronger balance sheet health.
3 Inflation Trends:
FY2025-26 was marked by a substantial decline in inflationary pressures. Headline Consumer Price Index (CPI) inflation moderated sharply to 2.1 per cent from
4.6 per cent in FY2024-25, remaining well below the Reserve Banks medium-term target. The decline was largely driven by food prices, which entered deflationary territory due to record agricultural production, favourable weather conditions, higher reservoir levels, and proactive supply-side interventions.
However, inflationary pressures were not entirely absent. Fuel inflation turned positive following LPG price revisions of Rs. 50 per cylinder in April 2025 and Rs. 60 per cylinder in March 2026. Core inflation remained relatively sticky at around 4.3 per cent, although it moderated towards the end of the year. Notably, elevated gold and silver prices accounted for nearly half of core inflation during the second half of the year, reflecting investor demand for safe-haven assets amidst geopolitical uncertainty. This led the RBI to assert that "underlying demand led price pressures are muted".
4 Stock Market Performance:
Indian equity markets experienced a year of significant volatility. Strong domestic growth, declining inflation, expectations of monetary easing, sovereign rating upgrades, and robust corporate earnings initially supported investor sentiment. However, these gains were subsequently offset by escalating geopolitical tensions, tariff-related uncertainties, foreign portfolio outflows, and concerns regarding global growth.
The BSE Sensex declined by 7.1 per cent during FY2025-26, closing at 71,948 by the end of March 2026. Mid-cap and small-cap segments also witnessed corrections, although domestic institutional investors helped cushion the impact of foreign selling. Foreign portfolio investors withdrew approximately Rs. 2.7 lakh crore from Indian equity markets during the year, while domestic institutional investors infused nearly Rs. 8.5 lakh crore, reflecting growing domestic participation in financial markets.
Despite weakness in secondary markets, primary market activity remained exceptionally strong. Resource mobilisation through IPOs, FPOs, rights issues, qualified institutional placements, and preferential allotments exceeded Rs. 4.5 lakh crore. Monthly systematic investment plan (SIP) inflows reached an average of Rs. 29,100 crore, underscoring the growing role of retail investors in Indias capital markets.
5 Yield Movements:
Government securities markets underwent significant repricing during the year. During the first half, declining inflation, policy rate reductions, and substantial liquidity injections by the RBI contributed to a softening bias in bond yields. Market participants anticipated a prolonged easing cycle as inflation fell well below target.
However, the latter half witnessed a reversal. Stronger- than-expected GDP growth, concerns over fiscal implications of GST rationalisation, oversupply of state government securities, rising global crude oil prices, and the outbreak of the West Asia conflict led to a hardening of yields. The benchmark 10-year government bond yield crossed the 7 per cent mark by March 2026, reaching its highest level since mid-2024.
Corporate bond markets also experienced upward pressure on yields, accompanied by wider credit spreads as investors reassessed risk in a more uncertain global environment. This drove a shift in demand for financial resources by commercial sector towards banking sector. Nevertheless, market functioning remained orderly, supported by RBI liquidity operations and active debt market participation.
6 External Sector Developments:
Indias external sector demonstrated remarkable resilience despite heightened global uncertainty. The current account deficit remained contained at sub-1.0 per cent of GDP, in 2025-26 during the corresponding period of the previous year. This performance was achieved despite a widening merchandise trade deficit of over US$330 billion.
Strong services exports and remittance inflows played a crucial stabilising role. Software exports, business services, and professional services continued to record healthy growth, while remittances increased by over 10 per cent. Gross foreign direct investment inflows remained robust at US$94.5 billion, reflecting sustained investor confidence in Indias medium-term growth prospects. However, net FDI flows stayed in single digits on consistent outflows.
While foreign portfolio investment flows turned negative with net outflows of US$16.5 billion, particularly after the outbreak of the West Asia conflict, external vulnerability indicators remained comfortable. Foreign exchange reserves continued to provide import cover of nearly eleven months, while external debt remained moderate at 20.4 per cent of GDP. The ratio of reserves to external debt stood close to 90 per cent, highlighting Indias strong external balance sheet.
7 Liquidity Conditions:
Liquidity conditions remained largely accommodative throughout FY2025-26. The Reserve Bank undertook a series of measures to ensure adequate liquidity in support of economic growth and policy transmission. Most notably, the Cash Reserve Ratio (CRR) was reduced by 100 basis points from 4.0 per cent to 3.0 per cent through phased implementation, releasing substantial durable liquidity into the banking system.
The RBI also conducted large-scale open market operations and liquidity injections. As a result, reserve money and broad money growth accelerated. Broad money (M3) growth reached 12.0 per cent, while the money multiplier improved from 5.7 to 6.1. Average daily money market turnover increased significantly, reflecting ample liquidity and smooth market functioning.
Currency in circulation expanded by 12.0%, supported by stronger consumption demand and fiscal transfers. At the same time, digital payments continued to grow rapidly, with UPI transaction volumes increasing by nearly 23.86%, demonstrating continued progress in financial digitisation.
8 RBI Policy Decisions and Transmission into Lending and Deposit Rates:
The substantial moderation in inflation enabled the Reserve Bank to pursue monetary easing during FY2025- 26. Policy measures included reductions in policy rates, significant liquidity support, CRR cuts, and open market purchases of government securities. These actions helped maintain favourable financial conditions and support economic activity.
Transmission into financial markets was relatively effective. Money market rates, treasury bill yields, and government securities yields responded quickly to policy actions. The weighted average call rate remained closely aligned with the policy repo rate, indicating efficient liquidity management.
However, transmission to bank lending and deposit rates was more gradual. While lending rates softened and supported stronger credit growth, deposit rates remained relatively sticky. This reflected persistent competition for deposits as credit growth continued to outpace deposit mobilisation. The increasing attractiveness of mutual funds and capital market investments also intensified competition for household savings, limiting the pace of deposit rate adjustments.
9 Banking Sector Environment:
The banking sector entered FY2026-27 from a position of considerable strength. Credit growth remained robust at approximately 15.7 per cent, driven by retail loans, services sector financing, and a revival in industrial credit demand. Total financial resources flowing to the commercial sector increased sharply from Rs. 36.2 lakh crore in the previous year to Rs. 47.0 lakh crore, reflecting strong financing requirements across the economy.
Deposit growth remained healthy but continued to lag credit expansion, resulting in a persistent credit- deposit gap. This increased the importance of deposit mobilisation and alternative funding sources. Banks responded by drawing down excess investments in government securities. Excess SLR holdings declined from 10.3 per cent to 8.2 per cent of Net Demand and Time Liabilities, indicating greater deployment of resources towards productive lending.
Sector-wise credit deployment reflected the broad- based nature of Indias economic expansion during FY2025-26. Credit growth to the services sector remained the principal driver, supported by lending to NBFCs, trade, transport operators, commercial real estate and professional services. Retail credit growth continued to remain robust, led by housing loans, vehicle loans and other personal loans, although growth in unsecured retail lending moderated following regulatory measures aimed at strengthening risk management. Industrial credit witnessed a notable revival after several years of subdued performance, driven by infrastructure, power, construction, engineering, renewable energy, chemicals, cement and metals sectors.
Credit demand from MSMEs also remained healthy, supported by government initiatives, formalisation of economic activity and improving business confidence. Agriculture and allied activities continued to receive policy support, with agricultural credit maintaining steady growth to support rural income generation and food security objectives. The broad-based expansion in sectoral credit indicates that bank lending is increasingly aligned with productive investment, infrastructure creation and consumption demand, thereby supporting the economys medium-term growth trajectory.
Transmission of monetary policy exhibited a mixed pattern. While money market rates, treasury bill yields and government bond yields adjusted relatively quickly to RBI policy actions, transmission to bank lending and deposit rates occurred more gradually. External benchmark-linked loans transmitted policy changes faster, while MCLR-linked loans adjusted with some lag. Lending rates softened as policy easing gained traction, thereby supporting credit demand from households and businesses. Deposit rates, however, remained relatively sticky due to intense competition for deposits and the need to maintain stable funding sources. As a result, the pace of reduction in deposit rates was slower than the decline in policy rates, compressing banks net interest margins to some extent.
Asset quality indicators remained stable, supported by stronger corporate balance sheets, improving household finances, and prudent risk management. Capital adequacy remained comfortably above regulatory requirements, while profitability continued to improve. From a sectoral risk perspective, banks continue to closely monitor exposures to commercial real estate, unsecured retail lending and MSMEs, particularly in the context of rising global uncertainties and higher energy costs stemming from the West Asia conflict. Nevertheless, stress indicators across most major sectors remain significantly below historical averages.
Public sector banks continued their turnaround story, reporting improved profitability, lower NPAs and stronger capital positions. Their share in incremental credit growth increased for the second consecutive year, reflecting stronger competitiveness and healthier balance sheets. Overall, the banking sector entered FY2026-27 with strong capital buffers, healthy profitability, robust credit growth, improving asset quality and adequate liquidity, placing it in a favourable position to support economic growth even amid heightened global uncertainties arising from the West Asia conflict and evolving global financial conditions.
10 Impact of the West Asia Conflict on the Economy and Banking Sector:
The outbreak of the West Asia conflict towards the end of FY2025-26 represented the most significant downside risk to the macroeconomic outlook. Given Indias dependence on imported crude oil, the conflict immediately raised concerns regarding energy security, inflation, external balances, and financial market stability. The RBI in its 2025-26 Annual report identifies "the West Asia conflict as the most significant risk to the Indian economic outlook".
The most direct impact was visible through rising crude oil prices, which increased transportation, logistics, manufacturing, and energy costs across sectors. The resulting inflationary pressures threatened to reverse some of the gains achieved through disinflation during the year. Financial markets reacted sharply, with foreign portfolio investors withdrawing approximately US$13.1 billion in March 2026 alone. Equity markets corrected, bond yields hardened, and the rupee depreciated to around Rs. 94.8 per US dollar.
For the banking sector, the conflict presents multiple transmission channels. Higher energy costs could weaken profitability in energy-intensive industries such as transportation, chemicals, aviation, logistics, and MSMEs. Elevated inflation may delay further monetary easing and increase funding costs. Market volatility could also affect treasury portfolios and investor sentiment. Nevertheless, the banking systems strong starting position provides substantial resilience. Double- digit credit growth, comfortable capital adequacy, adequate liquidity buffers, stable asset quality, and strong provisioning coverage collectively reduce the risk of systemic stress. While the conflict has undoubtedly increased macroeconomic uncertainty, Indias robust domestic demand, healthy banking sector fundamentals, contained current account deficit, strong foreign exchange reserves, and improving savings-investment dynamics position the economy well to absorb external shocks and sustain growth momentum.
11 Deposit Mobilization Department
The Deposit Mobilisation Department in the bank plays a crucial role in ensuring the financial health and operational success of the bank. Heres an overview of its key roles and responsibilities:
11.1 Attracting and Retaining Deposits:
• Formulates strategies to attract various types of term deposits
• Designs and promotes deposit schemes tailored to different customer segments (individuals, businesses, etc.).
11.2 Customer Relationship Management:
Builds strong relationships with depositors to encourage loyalty and long-term deposits.
11.3 Market Research and Analysis:
Analyses deposit trends, competitor offerings, and customer behaviour to refine deposit products and campaigns.
11.4 Coordinating with Branches:
Provides guidance and targets to branches for deposit mobilization to maintain sustainable growth.
11.5. Product Development and Innovation:
• Develops new deposit products and updates existing ones to meet changing market needs.
• Ensures products in comply with regulatory requirements
11.6 Monitoring and Reporting:
Tracks deposit growth and generate regular reports to bring further improvement.
11.7 Compliance and Risk Management:
Ensures all deposit mobilization activities adhered to banking Regulations.
New Initiatives taken during the year:
Launched Union wellness Deposit: The Bank has launched a new term deposit product named as Union Wellness Deposit in the Month of May 2025. Bank has mobilized a business of Rs 2840.00 Crore during FY 2025-26.
• Launched New 5 Current Account Variant : The Bank has launched 5 New variants of Current account namely Pearl, Emerald, Ruby, Sapphire & Diamond To cater to diverse business requirements and customer profiles in the Month of November 2025. Bank has mobilized a business of Rs 742.00 Crore during FY 2025-26.
v Introduction of Branch Assisted online Saving Account Opening Journey for existing Bank Customers: In order to enhance and digitize the banking services bank has introduced a New and dedicated branch assisted saving account journey for existing customers (ETB) who do not currently hold a saving bank account in the month of January 2026.
v Your Bank has opened 1,87,224 new salary accounts during the FY 2025-26 with outstanding balance of Rs. 347 Crore.
(Amt. Rs. in Crore)
| Domestic Term Deposit Performance Y-o-Y | |||||
| Parameters | FY 21-22 | FY 22-23 | FY 23-24 | FY 24-25 | FY 25-26 |
| Retail Term Deposit | 4,47,285 | 4,41,287 | 4,58,949 | 4,98,255 | 5,69,873 |
| Bulk deposit | 2,07,716 | 2,70,837 | 3,30,178 | 3,47,253 | 2,76,436 |
| Term Deposit | 6,55,001 | 7,12,124 | 7,89,127 | 8,45,508 | 8,46,309 |
| Total Deposit | 10,32,102 | 11,06,090 | 11,99,197 | 12,71,750 | 13,06,288 |
(Amt. Rs. in Crore)
Domestic Term Deposit Growth Y-o-Y |
|||||
Parameters |
FY 21-22 | FY 22-23 | FY 23- 24 | FY 24-25 | FY 25-26 |
| Absolute | Absolute | Absolute | Absolute | Absolute | |
Retail Term Deposit |
53,636 | -5,998 | 17,662 | 39,306 | 71,618 |
Bulk deposit |
15,154 | 63,121 | 59,341 | 17,075 | -70,817 |
Term Deposit |
68,790 | 57,123 | 77,003 | 56,381 | 801 |
Total Deposit |
1,10,475 | 73,988 | 93,107 | 72,553 | 34,538 |
v Introduction of Specialized Savings Bank Scheme SBGIG
(Savings Account for GIG and Platform Workers): In alignment with the Banks strategic focus on financial inclusion and in consideration of evolving workforce patterns within the Indian economy, bank has introduced a specialized Savings Bank Account scheme titled SBGIG. This scheme is designed to cater to gig and platform- based workers registered through the e-Shram Portal and operating across various sectors such as delivery services, ride-hailing, freelancing, e-commerce logistics, and home-service platforms.
Customer Base Growth:
NRE/NRO savings accounts increased from 8,79,967 to 9,04621, registering a growth of 2.80%.
Amt. Slab Wise RTD (as of Mar26)
11.8 NRI Deposits:
v NRI Deposits registered a growth of 10.21% during FY 2025-26, reflecting healthy and sustained expansion in the Banks NRI business portfolio.
v To strengthen engagement with the NRI community, the Bank organized NRI Carnival outreach programmes at major centres across India during the festive Christmas and New Year period, providing a platform to connect with and serve its valued NRI customers.
v FCNR deposits recorded a robust growth of 65.41% during FY 2025-26, demonstrating strong customer confidence and effective deposit mobilization efforts in the foreign currency segment.
11.9Way Forward:
v Focus on Granular CASA Growth: Strengthen acquisition of retail and small business customers; deepen balances through targeted campaigns.
v Leverage Digital Platforms: Scale up the branch-assisted online SB account opening journey and promote digital TD/RD onboarding.
v Promote New Products Effectively: Drive branch-level mobilisation for new Current Account variants, and the SBGIG scheme.
v Expand Outreach to New Segments: Target gig workers, professionals, MSMEs, trusts, and institutional entities for stable deposits.
v Strengthen Branch Execution: Provide clear targets, regular reviews, and capacity-building to improve deposit mobilisation performance.
v Enhance Monitoring & Market Intelligence: Use MIS dashboards to track trends, competitor pricing, and branch-wise achievements for timely interventions.
v Improve Customer Retention: Introduce proactive renewal reminders, simplified onboarding, and customer-focused service improvements.
v Ensure Compliance & Risk Management: Maintain strict adherence to regulatory requirements in all deposit-related activities.
12 Credit Management
12.1 Corporate Credit
The Banks total advance was Rs. 10,78,611 crore as of
31.03.2026, the corporate & other advance stood at Rs. 4,80,127 Crore. 12 large Corporate Branches (LCBs) and 38 Mid Corporate Branches (MCBs) across country are catering to the needs of corporate clientele. Bank registered growth of 6.80% on YoY basis in Corporate Credit.
Formation of Centralised Credit Processing Cell at Large/ Mid Corporate Vertical:
In order to make Large/ Mid Corporate Vertical more effective by leveraging services of corporate business Centers and streamlining of processing, increased efficiency and enhanced customer satisfaction, Centralised Credit Processing Cell has been implemented. This has helped in business growth and reducing overall TAT.
12.2 MSME
Business Growth:
(Amt. Rs. in Crore)
| 1 Particu lars | 1 March 25 | 1 March 26 | 1 YOYGmwth (%) |
| Total MSME Advance | 1,36,423 | 1,62,007 | 18.75% |
Performance of Key MSME Schemes: Bank has formulated specific schemes for targeted MSME segment. Detailed below are the performance of the bank under the identified MSME Schemes during the year.
(Amt. Rs. in Crore)
| Name of the Scheme | Sanctioned A/c (In Numbers) | Sanctioned Amt. |
| Union MSME Suvidha | 4,671 | 8,263 |
| Union Nari Shakti | 14,046 | 2,490 |
| Union Equipment Finance | 1,207 | 955 |
| Union Ayushman Plus | 428 | 388 |
| Union Contractor | 390 | 558 |
| Union Textile | 908 | 954 |
| Union MSE Support | 427 | 593 |
| Union MSME Salute | 317 | 1,818 |
12.2.1 MSME Loan Points:
The Bank continues to strengthen its MSME credit ecosystem through a well-established network of 138 MSME Processing Centers, which collectively appraised and sanctioned credit proposals amounting to Rs. 39,220 crore during FY 2025-26. These centers have been instrumental in ensuring efficient credit assessment, faster turnaround times, and enhanced customer service.
In line with its strategy of deepening MSME penetration and improving service accessibility, the Bank also operationalized three new MSME Loan Points during the year, further augmenting its specialized distribution network and supporting the evolving credit needs of MSME enterprises.
12.2.2 Outreach Camps:
The consistent field engagement of Central Office executives across their respective regions has significantly strengthened the MSME business ecosystem. Enhanced oversight, strategic guidance, and closer monitoring have collectively translated into improved business performance and accelerated growth across the regions.
12.2.3 Cluster Specific Schemes:
Bank has 22 approved cluster specific schemes across Pan India. During the financial year the total sanctions under cluster schemes was Rs. 2,572 Crore.
12.2.4 Union MSME First Branches:
As part of its focused strategy to strengthen MSME financing, the Bank operates 117 Union MSME Focused Branches (UMFBs) nationwide, with a cumulative MSME portfolio of Rs. 17,093 crore. During FY 2025-26, these branches facilitated sanctions amounting to Rs. 9,247 crore, significantly contributing to the Banks MSME portfolio growth.
To further deepen market penetration and provide dedicated support to MSME customers, the Bank expanded its specialized distribution network by opening four new MSME First Branches during the year, thereby reinforcing its commitment to delivering timely and customized financial solutions to the sector.
12.2.5 Nari Shakti Branch:
Bank has introduced Nari Shakti branches to reflect its commitment towards empowerment of women entrepreneurs in line with the same a new Nari Shakti Branch in Lucknow has been opened during this year. At present, Bank has six Nari Shakti branches. These branches were initially inaugurated by Honble Minister of Finance. Key services offered through these branches are as under:
Loan and deposit products suitable for women entrepreneurs.
• Advisory services.
• Workshops for Startups.
• Skill Development Programs
• Mentorship & Networking
Total business under the Nari Shakti Branches is Rs. 436 Crore (Advances: Rs. 312 Crore & Deposit Rs. 124 Crore).
62 Customer Relationship Executives were posted at potential locations to increase the MSME business. These executives are connecting to the existing as well as new MSME clients to deepen the existing relationships along with sourcing new accounts.
Sanctions under Credit Guarantee Schemes: Union Bank of India is at forefront in lending under Credit Guarantee Schemes for encouraging collateral free lending. Details of sanctions during FY 25-26 are as under
(Amt. Rs. in crore)
| Scheme | A/cs | Guarantee Amount |
| CGTMSE | 2,13,516 | 22,589 |
| CGFMU (Including Agri Allied) | 4,14,113 | 29,549 |
| Total | 6,27,629 | 52,138 |
Digital Transformations: MSME Customers can now apply loans digitally for their business requirements. In this front, Bank has digital journeys through which loans up to Rs. 1.00 Crore can be sanctioned digitally.
Performance of the Bank during FY under each digital product is as below:
| Digital journey | No. Accounts | Sanctioned Amount |
| STP Shishu Mudra | 21,519 | 104 |
| STP Kishore & Tarun Mudra | 66,267 | 3,061 |
| Nari Shakti STP | 10,733 | 621 |
| MSME Superfast STP | 801 | 324 |
| Union Digital Ease | 10,902 | 391 |
| Working Capital Enhancement | 48 | 4 |
| Total | 1,10,270 | 4,505 |
Other Digital Initiatives undertaken at Bank
Digi Renewal of the MSME accounts up to Rs. 25.00 Lac: During FY 25-26, 11.95 lac MSME accounts were digitally reviewed which forms 98% of the total account under the slab.
Upper ceiling of sanction through digital channel is increased to Rs. 1.00 Crore from Rs. 0.25 Crore.
Learning and Development: For comprehensive development of credit officers posted at MSME Loan Points (MLP) including the MLP Heads, training was provided within the existing training structure for improving the knowledge level for better implementation at their job role.
Besides above, Bank is also organizing webinars for creating awareness amongst the Bank officials about various MSME schemes and new developments in the related areas. Bank is circulating "MSME Impact Magazine" monthly which covers latest developments as well as present & future insights related to MSME.
12.3 Retail:
Banks Performance during FY 2025-26:
Overall Y-o-Y growth in retail loans outstanding is 16.75 %
Product wise Y-o-Y growth under Retail Lending is as under:
(Amt. Rs. in crore)
| Scheme | Actual March 25 | Actual March 26 | Growth over March 25 | % Growth Over March 25 |
| Home | 94,825 | 1,07,687 | 12,862 | 13.56 |
| Vehicle | 22,462 | 28,415 | 5,953 | 26.50 |
| Education | 15,912 | 18,166 | 2,254 | 14.17 |
| Mortgage | 16,152 | 18,023 | 1,871 | 11.58 |
| Personal | 11,225 | 11,505 | 280 | 2.49 |
| Others | 56,202 | 69,288 | 13,086 | 23.28 |
| Total Retail Advance | 2,16,777 | 2,53,083 | 36,306 | 16.75 |
0 Total Retail growth of Rs. 36,306 Crore over March25 0 Growth on YOY basis is 16.75 %.
PAN India basis, RLPs (CPCs) sanctioned Retail loans of Rs. 50 064 Crore during FY 2025-26
New initiatives Taken during FY 2025-26:
Launching of Digital Vehicle and Personal Loan to ETB and NTB customers.
Issuance of Rupay Select Debit Card to IIT and IIM Students.
Bank has sanctioned 192 Digital Education loan to female students of premier institute out of total 721 loan accounts under new digital initiative during FY 2025-26.
Bank has sanctioned 51,700 Digital Solar rooftop (PM- Surya Ghar) out of total sanction of 69,601 loans under the initiative during FY 2025-26.
Special Scheme for Category "A" Builder for Builder tie- ups/Project approval for seven Metro Centres.
Implementation of Digital Documentation Execution (DDE) under Digital Journey of PM Suryaghar - Muft Bijli Yojna for direct disbursement enablement.
12.4 Agriculture:
Agriculture lending has always been the priority area for the Bank. Agricultural credit constitutes 18% of Gross domestic advances and 17% of Gross global advances of the bank as on 31.03.2026.
Bank achieved 19.44% of Adjusted Net Bank Credit (ANBC), against the statutory target of 18% under Agriculture Priority sector for the FY 2025-26.
Credit to Agriculture stood at Rs. 1,83,394 Crore as on 31.03.2026.
Credit to small and marginal farmers stood at ?97,787 Crore(after sale of PSLC-SFMF Rs. 10,000 Crore) , which constitutes 10.73 % of ANBC against the benchmark of 10% for the FY 2025-2026. Bank sold Rs. 10,000 Crore under PSLC-Small & Marginal Farmer (SFMF) in the FY 2025-26 and earned ?133.87 Crore as non-interest income. Bank has issued 2.58 lakh fresh Kisan Credit Cards amounting to Rs. 6,462 Crore during FY 2025-26.
12.5 Priority Sector Advances:
Bank remains committed towards extending credit facility to the needy segments of the society. Banks priority sector advance stood at Rs. 3,74,078 Crore for the FY 2025-26, with 41.04% of ANBC against the statutory target of 40%, after netting the PSLC sales/purchase and including the investments in RIDF & other funds with NABARD, SIDBI, MUDRA and NHB.
(Amt. Rs. in crore)
| Particulars* | FY 2025-26 (Avg. of 4 quarters) | % to ANBC (Avg. of 4 quarters) | Benchmark FY 2025-26 (% of ANBC) |
| Priority Sector Credit | 3,74,078 | 41.04 | 40% |
| Agriculture Priority Sector | 1,77,205 | 19.44 | 18% |
| Small & Marginal Farmers | 97,787 | 10.73 | 10% |
| Micro Enterprises | 82,161 | 9.01 | 7.50% |
(*Post PSLC sale/ purchase & Including RIDF) (# Post PSLC sales of Rs. 10,000 Crore . in SFMF)
12.6 Specific Lending for Social Upliftment
Your Bank has continued to keep its focus on social development and equal opportunities for all segments of the society. Accordingly, the Bank extended credit facilities to various weak and unserved sections of the society specifically women, minority community and self-help group.
• Women Beneficiaries: With a view to promote entrepreneurs among the women and to make them self-reliant, bank encourages credit to women entrepreneurs. During FY 2025-26, Total outstanding loans to women beneficiaries has increased from Rs. 1,39,406 crore as of 31st March 2025 to Rs. 1,51,258 Crore in March 2026, with a growth of 8.5%.
Minority Communities: Bank is extending finance to the minority communities viz. Muslims, Christians, Sikhs, Buddhists, Zoroastrians, and Jains in line with Government of India directives on welfare of minority communities. As on March 31,2026 the outstanding credit to minority stood at Rs. 53,334 crore.
• Weaker Section: Bank has been actively participating in financing for weaker sections of society. Finances to weaker section including net sale of PSLC-SFMF stood at Rs. 1,15,921 Crore for the FY 2025-26 with 12.72% to ANBC against the benchmark of 12 %.
• Rural Self Employment Training Institute (RSETI): With an aim to mitigate the employment problem among the rural youth, Bank has established 42 RSETIs, in the districts where the bank has "Lead Bank Responsibility". As of March 31,2026, Total number of candidates trained in RSETIs are 3,68,241, out of which 2,65,182 candidates have been settled with a settlement ratio of 72%.
• Regional Rural Banks (RRBs): Previously, our Bank served as Sponsor Bank to Chaitanya Godavari Grameena Bank (CGGB). In the state of Andhra Pradesh, four Regional Rural Banks (RRBs) have been amalgamated into a single entity i.e., Andhra Pradesh Grameena Bank (APGB), under the sponsorship of our Bank, with Head office located at Guntur with effect from 01.05.2025. APGB has a network of 1359 CBS Branches, spread across the Andhra Pradesh state with Deposits of Rs. 64,673 Crore and Advances of Rs. 66,665 Crore (Net of IBPC of Rs5,000 Crore). APGB has achieved total business of Rs. 1,31,338 Crore with net profit of Rs. 1836 crore as on 31.03.2026. The Gross NPA stood at 0.91% with nil Net NPA as on 31.03.2026.
• Pradhan Mantri Fasal Bima Yojana (PMFBY):
Bank is implementing PMFBY for the benefit of farmers who faced climatic adversities very often and suffer a lot. All farmers including sharecropper and tenant farmers growing the notified crops in the notified areas covered under PMFBY.
• Area Specific Schemes: The bank has formulated 16 Area Specific Schemes, based on the available potential for the benefit of the farmers in the respective areas to augment lending under agriculture.
• Atmanirbhar Bharat Schemes/Emerging Renewable
Sectors: Bank has started capitalizing on huge investment taking place in Agri Infra Structure, Animal Husbandry and Food Processing through various Atmanirbhar Bharat Schemes like Agri Infrastructure Fund, Animal Husbandry Infrastructure Development Fund and Pradhan Mantri Formalization of Micro Food Processing Enterprises.
Bank is also leveraging other schemes under renewable energy like Compressed Bio-Gas (CBG) schemes, solar power plant/solarization of pump sets under PM KUSUM Scheme to achieve the sustainable development goals and to improve the Green Financing.
• Digitization in Agri:
Digital KCC-Fresh:Digital Kisan Credit Card (KCC STP) for fresh sanction up to Rs. 2.00 lakh rolled out in Karnataka, Madhya Pradesh, Uttar Pradesh, Odisha and Tamil Nadu states.
KCC STP for fresh sanction will be scaled up to Rs. 10.00 lakhs gradually Pan India where land records are digitized.
Digital KCC-Renewal and Enhancements: In order to strengthen digital footprints and utilize internal land records repository, bank has developed simplified digital Kisan Credit Cards (KCC) renewal journey up to Rs. 10 lakhs and made live Pan India.
Digital Kisan Tatkal: To augment digital lending business and instant credit for farming community to meet the emergency requirements for Farm activities, Bank has introduced "Digital Union Kisan Tatkal Loan" Scheme through STP (end to end) journey which is made available Pan India.
Digital Debt-swap: In order to facilitate the farmers to repay their high-cost debts from non-institutional lenders, Bank has introduced "Digital Debt-Swap Loan" scheme through STP (end to end) journey up to Rs. 50000.00 which is made available Pan India.
Digital journeys through Jan Samarth Portal:
The digital KCC STP through Jan Samarth portal for fresh sanction is made live in Karnataka, Maharashtra and Uttar Pradesh states.
Non STP lead generation journeys such as KCC Fisheries, eNWR, Agri Clinics and Agri Business centers (ACABC), SHG-NRLM and Individual enterprise loans to SHG members (Lakhpati Didi) are available.
12.7 Financial Inclusion:
Union Bank of India has been one of the leading public sector banks to serve the unserved and provide access of banking services to the last mile including opening of Pradhan Mantri Jan Dhan Yojana (PMJDY) Accounts, Overdraft in PMJDY accounts, enrolments under social security schemes such as Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Atal Pension Yojana (APY).
Pradhan Mantri Jan Dhan Yojana (PMJDY) Accounts: Pradhan Mantri Jan Dhan Yojana (PMJDY) Accounts play a crucial role in the financial inclusion initiatives by providing banking services to the unbanked populations. As of March 31, 2026, the Bank has opened 3.40 crore PMJDY accounts with a balance of Rs 15,964.06 Crores, compared to 3.21 crore PMJDY accounts with balances of Rs. 13,266.06 crores as of March 31, 2025. The average balance in PMJDY accounts has shown a steady progress from Rs. 4,124 as of March 31, 2025 to Rs. 4,692 as of March 31, 2026. Our commitment to financial inclusion is evident with over 1.27 lakh street vendors financed through the PMSVANidhi scheme during FY 2025-26, out of 10.97 lakh applications financed since inception under the scheme. The bank is committed to transforming lives of the street vendors with credit facilities and promoting economic development to underserved communities.
| PMJDY Accounts | 31st March 2025 | 31st March 2026 |
| Total PMJDY Accounts (In Lakhs) | 321.68 | 340.26 |
| Balances in PMJDY Accounts (Amt. Rs. in Crores) | 13,266.06 | 15,964.06 |
| Average Balances in PMJDY Accounts (Amt. in ) | 4,124.00 | 4,692.00 |
Business Correspondents (BC) as key drivers of financial inclusion initiatives: The Business Correspondent (BC) led financial inclusion model has evolved as one of the significant growth drivers in promoting access to banking services in the unbanked and underserved segments, creating awareness on social security schemes of the Govt. and promoting digitalization & educating customers on cyber security threats. Union Bank has a robust business correspondent network of 28,035 as of March 31, 2026. These BCs provide 42 banking services uniformly across pan-India including account opening, cash deposits, withdrawals, sourcing loan applications and enrolments under insurance and pension schemes.
The Bank has disbursed Rs. 2,042.85 crores of Retail, Agri & MSME advances as of March 31,2026 through the leads generated by the Business Correspondents, compared to Rs. 1125.60 crores as of March 31,2025.
Banks performance under Social Security Schemes (SSS): The performance of the Bank under Social Security Schemes including micro-insurance and pension schemes of the Govt of India for the financial year 2025- 26 is given as under:
| Sl. No. | Scheme | No. of accounts enrolled |
| 1. | Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) | 13,22,613 |
| 2. | Pradhan Mantri Suraksha Bima Yojana (PMSBY) | 42,81,823 |
| 3. | Atal Pension Yojana (APY) | 9,37,045 |
PMSVANidhi: Bank has disbursed Rs. 1,733.30 crore across Tranche 1, 2 & 3 under the PMSVANidhi scheme as of 31st March 2026 benefitting over 7.26 lakh beneficiaries till date. To further empower the street vendors, PMSVANidhi Credit Card facility has been introduced for PM SVANidhi beneficiaries by the Bank as per the directions of DFS, Gol and the MoHUA (Ministry of Housing and Urban Affairs). This initiative will provide vendors with on-demand access to credit, offering greater flexibility to meet day-to-day expenses and adapt to changing business needs.
PM SVANidhi
Application Nos. (in Lakhs)
Amt. Rs. in Crores
| App Sanctioned | 11.14 | 1,781.78 |
| w/w App Disbursed | 10.96 | 1,733.30 |
Financial Literacy Camps:
As on 31st March 2026, Bank has 79 FLCs and 203 CFLs conducted camps for educating rural & underserved population on Govt. sponsored schemes including social security schemes and digital products with focus on creating awareness on cyber security threats and digital frauds. During FY 2025-26, FLCs have conducted 6820 camps and CFLs have conducted 84,513 camps pan- India.
Bank has conducted financial literacy camps across 20,436 Gram Panchayats in the Saturation Campaign launched by the DFS, Govt of India during the 4-month period July 2025 to October 2025. The key activities carried in the camps included PMJDY account opening, enrolments under PMJJBY and PMSBY, enrolments under APY, Re-KYC of all eligible account holders, activation of in-operative PMJDY accounts, updating nominee in eligible SB accounts, awareness on prevention of digital frauds, ways to access unclaimed deposits and grievance redressals.
Bank has actively participated in RBIs Financial Literacy Week from 9th to 13th February 2026 with the theme "KYC-Your first step to safe banking" and successfully conducted about 1,127 camps.
The camps were given wide publicity and witnessed large scale participation of the customers and visits by the Senior / Top Executives of the bank.
13 International Banking:
Overseas business of your Bank stood at Rs. 38,260 Crores as on March 31,2026, compared to Rs. 37,415 Crore as on March 31, 2025. Your Bank has two overseas branches in DIFC (Dubai) and Sydney (Australia) and operates in London, United Kingdom, through its wholly owned subsidiary, Union Bank of India (UK) Ltd. The Gross Advance portfolio of the foreign branches stood at Rs. 37,657 Crore as on 31st March 2026, compared to Rs. 36,919 Crore as on 31st March 2025 and Net Profit of the foreign branches stood at Rs. 240 Crore for FY 2025- 26, compared to Rs. 190 Crore for FY 2024-25.
13.1Trade Finance:
Your Bank offers a bouquet of Trade Finance products and services to exporters and importers through an extensive, well equipped branch network that operates in India and abroad. There are 121 Authorized Dealing branches spread across the length & breadth of the country, Centralized Trade Finance Processing Centres and Centralized SWIFT Back Office, for orderly growth of the Trade Finance portfolio. Bank offers a bouquet of innovative products & services as per the market demand and changing regulatory norms to suit the customer needs.
Your bank has improved synergies and trade flow between Domestic Offices and Foreign Offices/ Correspondent Banks and the trading community by forming a strong link between them.
13.2 Correspondent Banking Relations:
To facilitate international trade & transactions, your Bank is maintaining RMA relationships with 829 banks in 93 countries and Nostro accounts with 34 Banks, in 14 different currencies.
13.3 Trade Finance Solution - Trade Nxt:
In the direction of digitalizing the Forex transactions, your bank has digital platform- "Trade Nxt". For processing of these transactions Centralized Trade Finance Processing Centres, at Mumbai & Mangalore are operationalized.
Trade Nxt is a Unique Digital Trade Services Platform for our customers to transact Foreign exchange transactions, efficiently & as per their convenience. The platform supports all type of trade transactions including for Exports, Imports, Guarantees and Remittances.
Key Features:
Convenience - Avail services from your home or office.
v 24x7 Availability - Trade related transaction can be initiated round the clock.
v Customization- Personalized dashboards,
customized templates.
Paperless Banking via Digitization - Dedicated portal for managing all trade transactions, Auto mailer intimations of advices and SWIFT messages.
v Efficiency - Substantial improvement in TAT due to Digitization and Centralization
v Relationship Manager - Improved customer service through dedicated Relationship Managers.
Compliance - Complying with Regulatory norms & Procedures along with International Best Practices.
Over the time, the Trade Finance Processing Centres(TFPC) have garnered a significant portion of trade finance transactions, with customers migrating to the Trade Nxt digital platform, thereby fortifying the forex back office operations.
Apart from Forex transactions, the TFPCs also carry out centralized processing of domestic LCs and guarantees.
Centralized SWIFT Back office has been set up at Mumbai for handling cross border transactions over the SWIFT network and for ensuring smooth & fully secured transmission of messages.
These enhancements are aimed at optimizing operational processes, enhancing security measures, and providing our customers with a superior banking experience.
13.4 Centralized ODI, FDI & ECB Cell:
Your Bank has set up the nodal office for approval, reporting, and monitoring of regulatory compliance related to ODI, FDI, and ECB transactions handled by the bank. It ensures timely processing of ODI applications with periodic RBI reporting, manages FDI reporting through the RBI portal, and handles new and revised ECB applications while coordinating with branches and RBI on capital account matters.
13.5 Exporters/ Importers meet:
Your bank facilitates the growth of Export Credit by actively engaging with branches, trade bodies & other stakeholders. Exporters / Importers meets, outreach campaigns were conducted across India at potential centres to increase awareness of the banking products & services offered by your Bank.
During FY 2025-26, 118 new clients have been brought into our export credit portfolio.
13.6 Export Credit:
Your banks Export Credit portfolio stood at Rs. 22,453 Crore as on 31.03.2026.
Your Bank is consistently maintaining second highest position amongst the PSBs in this segment since last 3 years.
13.7 New initiatives/ products:
• Your Bank has launched dedicated export credit schemes, namely Union Niryat Sugam and Union Niryat Protsahan Yojana offering collateral-free / flexible export finance with simplified processes, competitive pricing, and enhanced accessibility, particularly for MSME & manufacturer exporters.
• Your Bank has become a Special Category Client (SCC) with IIBX, GIFT City, enabling direct access to bullion imports with improved price discovery and reduced cost.
14 Treasury
14.1 In the financial year 2025-26, the Treasury function of the Bank continued to play a pivotal and strategic role in ensuring liquidity and profitability. It operated as a prudent liquidity manager, aligning its activities with the Banks broader corporate objectives, with a clear focus on optimizing returns while maintaining a balanced risk profile. The Treasury effectively managed credit, market, and liquidity risks within the framework of established policy guidelines.
14.2The Treasury adopted a disciplined approach towards cash management, leveraging a range of short-term money market instruments and foreign exchange operations. Treasury maintained an optimal mix of SLR and Non-SLR investments with appropriate maturity duration, ensuring profitability while safeguarding the Banks financial health. At the same time, conscious efforts were made to conserve capital by reducing reliance on high capital-intensive instruments and strategically shifting towards less capital-intensive avenues, thereby improving key financial metric such as Return on Capital Employed (ROCE).
14.3Guided by a forward-looking strategy, the Treasury focused on building a robust investment portfolio during favourable interest rate cycles. Maintaining the maturity duration in alignment with approved policy norms enabled the generation of consistent Treasury income. In addition, the Treasury actively explored various arbitrage opportunities available in the financial markets like foreign exchange, money markets, as well as among government securities, interest rate futures, and overnight index swaps. Such strategic positioning helped the Bank to capitalize on market movements and enhance overall returns.
14.4Recognizing that human capital is a key enabler of performance, the Treasury also invested in strengthening its manpower capabilities. Through a combination of in-house and external training programs, efforts were made to enhance the skills and efficiency of the team across all operational levels. Parallelly, the Treasury focused on strengthening its sales function to onboard new customers while ensuring seamless service delivery to existing clientele. Expansion of the sales team further supported the mobilization of Primary Dealer (PD) business, contributing to business growth.
14.5The results of these strategic initiatives were reflected in the Treasurys performance during the year. The Bank recorded a profit of Rs. 2,952 crore from investments, supplemented by a forex exchange profit of Rs. 1,076 crore. Together, these contributed to a total Treasury income of Rs. 4,028 crore, underscoring the effectiveness of its operational and strategic approach.
14.6In addition to operational achievements, the Treasury undertook important initiatives to strengthen its technological capabilities. During the year, the dealing room trading systems were upgraded with advanced software solutions, significantly enhancing operational efficiency and trading capabilities. These upgrades enabled faster decision-making, improved execution of trades, and better client servicing. The implementation of the upgraded Finacle Treasury software further strengthened the Treasurys ability to operate with precision and agility in dynamic market conditions.
14.7Overall, the Treasury function demonstrated resilience, strategic foresight, and operational excellence during the financial year. Through a balanced approach to risk, innovation, and growth, it continued to contribute meaningfully to the Banks profitability while reinforcing its position as a key driver of financial performance.
15 Asset Quality
15.1 Performance during FY 2025-26:
GNPA reduced from Rs. 35,350 Crore as of March 2025 to Rs. 30,401 Crore as of March-2026. Your Banks cash recovery & upgradation and details of other recovery and reduction figures for financial year 2025-26 is as under:
(Amt.Rs. in crore)
| Particulars | FY 2025-26 |
| GNPA as of 31.03.2025 | 35,350 |
| GNPA as of 31.03.2026 | 30,401 |
| Cash Recovery | 4,404 |
| Dummy Ledger Recovery | 1,931 |
| Rec. in written off a/cs | 3,997 |
| Gross Cash Recovery | 10,464* |
| Upgradation | 2,543 |
| Gross cash recovery + Upgradation | 13,007 |
% Gross NPAs |
2.82 |
* Includes recovery of Expenses during FY 2025-26 amounting to Rs. 132 crores.
15.2 Recovery Strategies initiated during FY 2025-26:
• Strengthening of Review mechanism along with escalation matrix across Specialized Recovery Branches/Regions/Zones/Authorized Officers.
• Enhanced publicity for E-Auction by circulating QR code with link to the properties under auction. During FY 2025-26, 2013 properties with sale price Rs. 1414 crores have been sold by the bank under SARFAESI.
• Holding Mega OTS camps on 1st and 3rd Saturdays of every month attended by executives from Central
• Expeditious examination of Willful Default cases.
• Focused monitoring of NCLT cases and providing timely guidance/support to the field in CIRP matters.
• Periodic review of advocates performance in handling DRT cases.
• Organizing additional Lok Adalats in coordination with DLSA and DRT authorities. During FY 2025- 26, 68702 accounts involving Rs. 2000 crores were settled by the Bank at various Lok Adalats.
• Allocation of regions to individual officers at SAMV CO for regular follow up on recovery matters.
• Regular follow up from Field Functionaries for recovery of OTS overdue amount.
• Maximization of Recovery through assignment of Debt to ARCs/NBFCs/NARCL/FIs. During FY 2025-26, 15 accounts having outstanding balance Rs. 1503.68 crores have been assigned to ARCs/NBFCs/NARCL/ Fis.
15.3 Revamped SAM Vertical Structure
Three General Managers posted in SAM Vertical, with a clear mandate to drive focused recovery efforts. Geographical mapping of zones will be undertaken by assigning specific Zones/regions to each GMs for enhanced accountability and improved monitoring. This is aimed at:
• Intensifying account-wise follow-up
• Ensuring time-bound resolution of stressed assets
• Strengthening on-ground supervision and coordination with zones
A special strategic focus will be placed on resolution of NPAs across high-impact segments, namely:
• Pool Buyout and Co-lending Portfolio
• Housing Loans
• Vehicle Loans
• Credit Cards
• Self Help Group (SHG) Advances
The targeted approach is expected to accelerate recovery momentum, optimize resolution outcomes, and improve overall asset quality in these critical segments.
16 Relationship Banking
Your Bank earned income of Rs. 514.21 Crore through the Wealth Management Vertical, during the year 2025- 2026.
16.1Initiatives during the year
• Wealth Relationship Managers were mapped to HNI customers of the Bank to cater to their investment needs.
• SP (Specified Person) Certified staff for carrying out insurance business increased from 18131 to 19572. Trainings provided to staff for better product knowledge and updated regulatory guidelines.
• EUIN holder staff for carrying out Mutual Fund business increased from 394 to 758.
• During September 2025, Vertical had activated over 97.50% branches under life insurance segment.
• Focus on ensuring adequate insurance penetration to Banks customers.
• Bima-ASBA process implementation is made live for Life Insurance segment through our business partner SUD Life Insurance Co.
16.2.New Products Launched in 2025-26:
Mutual Fund NFOs: Following four NFOs of Union
Mutual Fund were launched:
• Union Diversified Equity All Cap Fund of Fund
• Union Consumption Fund.
• Union Income plus Arbitrage Active Fund of fund
• Union Low Duration Fun
16.3Digital Initiatives:
• M/s Fintech Blue Solutions Pvt Ltd has developed digital platform on mobile app and branch portal for insurance business. 44 Insurance products from SUD Life, IndiaFirst Life, Care Health, Manipal Cigna, Bajaj General, Chola MS General and United India General Insurance Company are live on the platform.
• Developments under process for services like renewing the policies, raising Insurance claims, Commission reconciliation etc. through the digital platforms.
• Branch portal (Union Invest) with schemes from 20 top AMCs available for Mutual Fund investments.
17 Government Business
During FY 2025-26, Union Bank of India further strengthened its position in the Government Business segment through strategic partnerships and technology-driven banking solutions for Government, Semi-Government and Quasi-Government institutions. The Bank executed and renewed 17 Memorandum of Understanding (MoUs) and approved institutional tie- ups covering salary accounts, pension business and salary portal solutions with prominent organisations. These partnerships are expected to provide substantial opportunities for CASA growth, retail lending and deepening institutional relationships across the country.
Bank achieved significant milestones in financial inclusion and social security initiatives by mobilising 6.55 lakh Small Savings Accounts and 62,065 National Pension System (NPS) accounts during the financial year. To enhance customer convenience and digital accessibility, Union Bank enabled GST payments through Credit Card, Debit Card and UPI channels, facilitated Direct Tax payments through Debit Cards, and introduced a fully digital journey for opening NPS accounts through its Digital Banking Portal. Further, the Bank is designated as the exclusive banking partner by the Ministry of Environment & Forests for managing the centralised consent management system across 36 State Pollution Control Boards (SPCBs), creating a significant business opportunity with an estimated annual transaction flow of approximately Rs. 4,000 crore. These achievements reflect the Banks continued commitment towards expanding its Government Business portfolio through innovation, institutional collaboration and customer- centric digital solutions.
18 Human Resources Management
18.1Strategic Role of Human Resources
"A resilient institution is defined not only by its performance, but by how it values, supports, and empowers its people."
At Union Bank of India, employees are recognized as the Banks most valuable asset and the key drivers of sustainable growth and service excellence. In an increasingly dynamic and complex banking environment, the Human Resources function has continued to evolve as a strategic partner to the business.
Moving beyond traditional administrative roles, the HR function has focused on fostering an enabling ecosystem that supports employees through transparent policies, clearly defined career pathways, and consistent communication. The emphasis remains on cultivating a workplace culture that balances operational priorities with employee well-being and professional development.
During FY 2025-26, the Bank reinforced its commitment to maintaining an employee-centric work environment characterized by respect, inclusivity, care, and opportunities for growth. The Bank continues to believe that a motivated, engaged, and well-supported workforce is fundamental to sustaining customer trust, delivering responsible banking services, and creating long-term value.
The Banks human resource strategy remains aligned with its vision of becoming a next-generation, digitally enabled institution, while ensuring that its people practices are empathetic, inclusive, and responsive to the evolving needs of its workforce.
18.2 Key Strategic HR Initiatives in FY 2025-26:
18.2.1 ISO 30414:2025 - Human Capital Reporting & Digital Enablement
During FY 2025-26, the Bank advanced its human capital governance framework through the transition from ISO 30414:2018 to ISO 30414:2025, the globally recognized standard for Human Capital Reporting and Disclosure. This transition strengthens the Banks capability to deliver standardized, reliable, and comparable reporting of workforce metrics across critical human capital dimensions, while aligning with emerging Environmental, Social, and Governance (ESG) and sustainability disclosure expectations.
To operationalize this framework, the Bank implemented a dedicated ISO-aligned digital data capture module, enabling centralized, secure, and auditable management of human capital information. This initiative enhances transparency, supports robust internal analytics and monitoring, and facilitates credible external disclosures consistent with international reporting benchmarks.
18.2.2 Enhancing Performance Management and Recognition
The Bank continues to reinforce a robust, transparent, and objective Performance Management System (PMS), designed to align individual performance with organizational priorities and long-term strategic outcomes.
The PMS framework was further strengthened to promote fairness, consistency, and objectivity in performance evaluations, with enhanced alignment between individual deliverables and institutional goals.
The Rewards and Recognition architecture remained integral to reinforcing a culture of accountability and excellence, with continued emphasis on acknowledging high-impact contributions.
A structured, merit-based performance differentiation and enablement framework has been instituted for Business Unit Heads to reinforce leadership accountability and performance ownership. Leaders are classified as Trailblazers, Accomplishes, or Aspirers based on sustained performance against clearly defined KRAs spanning business growth, asset quality, compliance, customer experience, and strategic priorities. High-performing leaders are recognised through calibrated career-linked incentives, including preferential consideration for advancement, premium postings, enhanced APAR ratings, leadership mentoring, and exposure to strategic and global learning platforms. Concurrently, a structured performance improvement mechanism, encompassing early identification, personalized guidance, focused capability-building interventions, mentoring support, and periodic performance reviews, is in place to facilitate sustained performance enhancement and leadership development.
High-performing leaders are recognized through calibrated career advancement opportunities, leadership visibility, and targeted development interventions. Concurrently, structured support mechanisms comprising early performance flagging, mentoring, focused capability building, and monitored improvement plans ensure that employees are provided with appropriate developmental support to enhance performance outcomes.
The Bank has instituted a structured framework to recognize and incentivize meritorious sportspersons within the organization. Exceptional performers are rewarded through out-of-turn promotions, performance-linked increments, and monetary awards, thereby encouraging excellence beyond professional responsibilities. Top achievers are also honored as "Sports Star of the Zone", recognizing their accomplishments and positioning them as ambassadors of the Bank. Their engagement in branding and business development initiatives further enhances the Banks visibility and outreach. Such measures contribute to fostering a culture of excellence, discipline, and organizational pride.
The Bank has introduced a structured policy to effectively leverage the experience and institutional knowledge of veteran employees in support of transformation initiatives, strengthened governance, and organizational continuity. The policy establishes clearly defined roles and processes to ensure transparency, accountability, and compliance, while enabling informed decision- making in a dynamic environment.
This initiative is beneficial to the Bank by enhancing governance standards, ensuring continuity in critical functions, and facilitating smoother execution of strategic priorities. For employees, it provides opportunities to contribute meaningfully beyond conventional roles, encourages knowledge sharing and mentoring, and enables continued professional engagement, thereby fostering a sense of value, recognition, and organizational belonging. Employee Engagement and Well-being
18.2.3 Employee Engagement and Well-being
"Organizations thrive when employees feel cared for, supported, and understood."
Employee well-being and engagement remained a central pillar of the Banks human resource philosophy during FY 2025-26. The Human Resources function implemented a comprehensive suite of employee-centric initiatives aimed at promoting holistic well-being?encompassing physical, mental, and emotional health?while fostering work-life balance and organizational connectedness.
Particular focus was placed on supporting frontline and field-level functionaries through strengthened institutional support systems, welfare measures, and responsive engagement mechanisms. These initiatives have contributed to enhancing employee morale, resilience, productivity, and overall job satisfaction, thereby reinforcing a positive and inclusive workplace culture across the organisation.
18.2.3 (i) Initiatives under Employee Assistance Programme - (Supporting Wellness and Resilience) - The Bank introduced a structured Employee Assistance Programme designed to provide employees with accessible and timely support for their physical and psychological well-being. The programme incorporates a range of initiatives such as desk yoga sessions, wellness webinars, and awareness campaigns, including Mental Health Day observances and Suicide Prevention programmes. These interventions have enhanced awareness of mental health, reduced stigma, and encouraged proactive self-care, thereby contributing to improved emotional well-being, focus, and workplace engagement among employees.
18.2.3 (ii) One-to-One Counselling Support
The Bank has empaneled M/s EAP India to provide confidential counselling services to employees and their dependents.
The programme offers multi-modal access (telephonic, video, and in-person) with 24^7 availability and strict confidentiality protocols. It includes specialized services such as crisis intervention, family and maternity counselling, and multilingual support. This initiative has enabled employees to effectively manage personal and professional challenges, improve emotional resilience, and strengthen interpersonal relationships, thereby enhancing overall workplace effectiveness.
18.2.3 (iii) Doctor Tele Consultation Services
The Bank has empaneled M/s Arcofemi Healthcare Pvt. Ltd. (Mediwheel) to provide round-the-clock tele-consultation services to employees and their dependents.
The platform facilitates access to general physicians and specialists through phone, video, and chat-based interfaces, along with e-prescriptions, preventive healthcare guidance, nutrition counselling, and digital health records. This initiative has significantly enhanced employees access to timely and convenient medical support, enabling early diagnosis and intervention while reducing the need for physical consultations. It has also improved continuity of care across locations, supported better health management for employees and their families, minimized disruptions to work schedules, and contributed to improved overall well-being and enhanced workplace productivity.
18.2.3 (iv) Online Yoga and Meditation Program
The Bank engaged M/s Heartfulness Education Trust to deliver structured online yoga, meditation, and mindfulness programmes for employees and their dependents. The programme comprises live and recorded sessions, beginner-friendly modules, thematic wellness calendars, and specialized sessions, including those designed for differently-abled employees. Delivered through a dedicated digital platform, the initiative focuses on stress management, emotional balance, and reflective practices, thereby supporting holistic well-being and fostering enhanced mental clarity, resilience, and overall employee effectiveness.
18.2.3(v) Various internal communication platforms, including publications such as "Union Dhara," "Union Srijan," and "Banking Updates," along with audio-visual mediums like "Union Radio" and "Union Podcast," were effectively leveraged to support employee engagement and well- being. These platforms facilitated timely information dissemination, knowledge sharing, and organizational alignment, while also strengthening employee connect, promoting transparency, and fostering a sense of inclusion and belonging across the workforce.
18.3 Celebrating our People
"Recognizing people for their dedication and values strengthens not only morale, but the institution itself."
At Union Bank of India, celebrating our people is an integral part of building an engaged, inclusive, and values-driven organizational culture. The Bank firmly believes that recognizing employee contributions, service milestones, and collective achievements fosters motivation, reinforces organizational values, and nurtures a strong sense of belonging. Key initiatives undertaken during FY 2025-26 include:
18.3 (i) Family & Sports Day
The Bank continued to promote a culture of engagement and inclusivity through the of Sports Meets and Family Day events during FY 2025-26. These initiatives provided valuable platforms for employees and their families to connect beyond formal work settings, thereby strengthening interpersonal relationships and fostering a sense of belonging within the organisation. The Sports Meets encouraged physical fitness, teamwork, and a spirit of healthy competition, while the Family Day celebrations recognised the vital role of employees families in supporting their professional commitments. Such initiatives underscore the Banks commitment to enhancing employee morale, reinforcing organisational cohesion, and promoting a balanced and inclusive work environment.
18.3 (ii) HR Week
HR Week was observed to highlight the strategic importance of human capital in the Banks sustained success. The initiative focused on enhancing employee engagement, promoting awareness of HR policies and practices, and fostering constructive interaction between employees and leadership?creating experiences that participants will value and cherish.
18.3(iii) Womens Day
Womens Day celebrations reaffirmed the Banks commitment to diversity, equity, and inclusion. The initiative recognized the contributions of women employees and promoted awareness around empowerment, equal opportunities, and leadership development, creating meaningful moments of recognition that employees will cherish.
18.3 (iv) Hindi Diwas
Hindi Diwas was observed to encourage the use of Hindi in official work and promote linguistic inclusiveness. The initiative aligns with the Banks commitment to the progressive implementation of the Official Language Policy while fostering a sense of cultural pride that employees will continue to cherish.
18.3 (v) Staff Meets
Staff Meets served as effective platforms for dialogue, engagement, and alignment with organizational priorities, facilitating open communication, knowledge sharing, and stronger connect between management and employees?experiences that strengthen trust and are valued by employees.
18.3 (vi) Milestone Awards - Long-Term Service and Superannuation
The Bank honoured employees for their long and dedicated service upon completion of key milestones, including 15 and 25 years of service, as well as at superannuation. These recognitions celebrate enduring commitment and create proud moments that employees and their families will cherish.
18.3 (vii) Recognition and Appreciation Ceremonies
Recognition ceremonies were conducted to acknowledge exemplary performance and significant contributions by individuals and teams, thereby reinforcing a culture of excellence and creating lasting recognition experiences that employees will cherish.
Through these initiatives, Union Bank of India continues to foster an employee-friendly environment where dedication is valued, achievements are celebrated, and employees feel respected and connected to the organization. By recognizing both service and performance, the Bank strengthens its human capital foundation with experiences that employees take pride in and cherish, supporting long-term organizational resilience and growth.
18.4. HR Transformation and Digital Enablement
During FY 2025-26, the Bank advanced its HR transformation agenda with a focused emphasis on enhancing employee convenience, accessibility, and process efficiency. The integration of digital platforms enabled simplification of HR processes, minimized manual interventions, and improved transparency across key employee lifecycle services. These initiatives have strengthened service delivery by ensuring timely and seamless access to information, support, and HR services for employees and managers, thereby enhancing trust, engagement, and operational effectiveness.
Further, the Bank strengthened the accessibility and inclusivity of its key employee-facing platforms?Union Parivar (HRMS), EKAM (Performance Management), and Union Vidya (Learning and Development)? by aligning them with Web Content Accessibility Guidelines (WCAG). This initiative ensures consistent, user-friendly, and barrier-free access to HR services, learning resources, and internal communication systems across diverse employee groups, including those with accessibility needs.
The adoption of WCAG standards has enhanced system usability, reduced access-related dependencies, and enabled uniform adoption at scale. This approach reflects the Banks commitment to embedding inclusion within its digital HR ecosystem, while simultaneously strengthening governance, enhancing user experience, and ensuring long-term sustainability of its digital platforms.
18.5 Talent Acquisition and Development
The Bank continued to strengthen its talent acquisition and development framework, recognizing that a skilled, diverse, and future-ready workforce is critical to delivering sustained growth, superior customer experience, and long-term stakeholder value.
During FY 2025-26, recruitment processes were further digitized and streamlined, enabling wider outreach, improved selection efficiency, and access to a diverse talent pool. This has contributed to improved workforce quality, faster onboarding cycles, and enhanced alignment with business requirements.
Recruitment of Local Bank Officers (LBOs) -To strengthen regional capabilities and improve customer experience, particularly in rural and semi-urban geographies, the Bank recruited 1,455 Local Bank Officers (LBOs) with proficiency in regional languages. This initiative has enhanced customer engagement, enabled better understanding of local needs, and improved service delivery outcomes. The Bank continues to prioritise such targeted hiring to deepen its outreach and drive inclusive banking.
Domain Expert Hiring- The Bank continued to onboard domain specialists at middle and senior management levels to augment functional expertise in key areas. This has strengthened decision-making capabilities, improved operational efficiency, and supported the Banks evolving business, digital, and regulatory landscape.
Apprenticeship Hiring - In alignment with the Apprentices Act,1961, the Bank expanded its apprenticeship programme across India. The programme serves as a strategic talent pipeline by providing structured, hands- on training in banking operations and BFSI products. It not only enhances employability and skill development among youth but also supports the Banks long-term workforce planning and talent sustainability objectives.
18.6. Promotion diversity, Equity and Inclusion (DEI)
Union Bank of India remains committed to fostering a diverse, equitable, and inclusive workplace, recognising that diversity of thought, background, and experience strengthens organisational capability and drives sustainable growth. The Bank continues to promote a culture grounded in fairness, respect, and dignity, ensuring equitable opportunities across geographies, cadres, and employee groups.
Ms. Chhonzin Angmo, a 100% visually impaired employee of the Bank, exemplifies resilience, determination, and the spirit of excellence. Having progressed from the Clerical to Officer cadre, she is presently serving as Asst. Manager, Vijay Nagar Branch, Regional Office Delhi (N).
Driven by an unwavering commitment to achieve the extraordinary, Ms. Angmo successfully scale Mount Everest in 2025. Her mountaineering accomplishments also include successful expeditions to Mount. Elbrus (Europe), Mount Kilimanjaro (Africa) & Mount Aconcagua (South America).
Her journey continues to inspire employees across the Bank and reinforce the Banks commitment to fostering inclusivity, empowerment and excellence.
Ms. Rituja Pisal, India Hockey Team Player, who represented India at various International/National Tournaments was awarded with an out of turn promotion from clerical to Officer Cadre on account of her performance during the Asian Cup 2025.
The Bank has institutionalised robust policies on Prevention of Sexual Harassment (POSH), Equal Opportunity, and Diversity, Equity, and Inclusion (DEI). These policies are actively implemented through regular awareness programmes and sensitisation initiatives, embedding inclusive practices into day-to-day operations and fostering a culture of belonging.
The Bank endeavours to create an inclusive work environment for all employees, including persons with disabilities, through reasonable workplace accommodations. Assistive solutions such as screen- reading software (JAWS) are provided to visually impaired employees, enhancing accessibility and enabling effective participation in organisational processes.
As part of its inclusive employee support framework, the Bank provides additional conveyance allowance to employees with disabilities, facilitating ease of travel and reducing accessibility-related constraints. This initiative contributes to improved employee well-being, productivity, and engagement.
The Bank also supports women and employees belonging to reserved categories through enabling provisions in transfer, promotion, and welfare policies. Women employees are provided preferential consideration for convenient postings and transfers on spouse grounds, facilitating work- life balance and family cohesion.
Dedicated SC/ST and OBC Cells have been established at the apex level to address employee grievances and ensure policy compliance. The Bank has also appointed Chief Liaison Officers at the level of General Manager at the Central Office to oversee and strengthen the implementation of statutory and regulatory provisions for these categories.
Inclusion Metrics as on (31.03.2026)
Particulars |
Officers |
Clerks |
Sub-staffs |
Total |
||||
Total Employees |
45722 |
22768 |
5395 |
73,885 |
||||
W/w |
||||||||
Scheduled Castes (SCs) |
7,947 | 17.38 | 4,327 | 19.00 | 1,999 | 37.05 | 14,273 | 19.32 |
Scheduled Tribes (STs) |
3,534 | 7.73 | 1,806 | 7.93 | 453 | 8.40 | 5,793 | 7.84 |
Other Backward Classes (OBCs) |
14,302 | 31.28 | 7,374 | 32.39 | 1,818 | 33.70 | 23,494 | 31.80 |
Ex-Servicemen |
863 | 1.89 | 2,992 | 13.14 | 303 | 5.62 | 4,158 | 5.63 |
Women |
12,635 | 27.63 | 7,335 | 32.22 | 1,807 | 33.49 | 21,777 | 29.47 |
Minority Communities |
3,273 | 7.16 | 1,597 | 7.01 | 387 | 7.17 | 5,257 | 7.12 |
Within which..
| Category | COUNT | Percentage |
| EWS | 1,216 | 1.65 |
| GEN | 29,109 | 39.40 |
| OBC | 23,494 | 31.80 |
| SC | 14,273 | 19.32 |
| ST | 5,793 | 7.84 |
| Blind | 920 | 1.25 |
| Deaf and Dumb | 357 | 0.48 |
| Intellectually Disabled | 50 | 0.07 |
| Orthopaedically Handicapped | 1,361 | 1.84 |
| Ex-servicemen | 4,158 | 5.63 |
| TOTAL | 73,885 |
18.7Learning & Development as a Strategic Business Enabler
The Banks Learning & Development (L&D) function continued to play a pivotal role in strengthening organisational capability and building a future-ready workforce. Aligned with strategic objectives and evolving business requirements, the L&D ecosystem fostered a culture of continuous learning, performance excellence, and leadership readiness across all levels, supporting sustainable human capital development.
The Bank made sustained investments to provide employees with access to high-quality learning resources, including a robust faculty network, contemporary content, technology-enabled learning platforms, globally recognised certification programmes, and partnerships with premier academic institutions. These initiatives enhanced functional, managerial, leadership, and digital capabilities across the workforce.
The Banks learning initiatives contributed to improved employee capability, enhanced productivity, and strengthened leadership pipeline development. The focus on digital learning and inclusive access to training supported equitable skill development across geographies and employee segments. These efforts align with the Banks commitment to responsible workforce development, continuous upskilling, and long-term talent sustainability under its ESG framework
18.8 Capacity Building
The Union Learning Academies (ULAs) and Zonal Learning Centres (ZLCs) together delivered an extensive range of training interventions aimed at holistic capability enhancement. During the year, the Bank achieved extensive learning outreach through a blended delivery model. ULAs conducted 629 classroom and locational training programs, covering 19,386 employees. In addition, 160 virtual training programs reached 9,108 employees, while 350 webinars enabled large-scale knowledge dissemination to 64,912 participants. These efforts were further strengthened by Zonal Learning Centres (ZLCs), which conducted 1,080 classroom programs (26,683 participants), 574 locational programs (22,016 participants), 194 virtual programs (11,395 participants), and 290 webinars (24,927 participants), significantly enhancing training penetration across the Bank.
The Bank imparted over 23.10 lakh learning hours during the year, with average learning hours per employee per quarter at 31.24 hours, underscoring a strong institutional commitment to continuous upskilling and workforce development.
To build advanced and domain-specific capabilities, specialized programs were rolled out in collaboration with premier institutions such as IIM Indore, ISB Hyderabad, and MDI Gurgaon. 346 officers were trained across five focused domains?Risk Management, Strategy & Finance, Sales & Marketing, Operational Excellence, and Digital Financial Inclusion, FinTech & Co-lending. Additionally, 100 internal faculty members were upskilled through Train-the-Trainer programs conducted by these institutions, further strengthening in-house training capability.
Leadership development remained a key priority, with 42 Leadership Development Programs attended by 867 senior executives (Scale V to Scale VII), enhancing strategic leadership, decision-making, and change management competencies.
The Bank also encouraged external and international exposure, with 1,212 employees participating in external training programs, including 26 officers who attended overseas programs, gaining global perspectives and benchmarking insights.
18.9Knowledge Creation and Faculty Accomplishments
The Bank continued to reinforce institutional learning during the year through focused investments in research and faculty development. Research Officers completed 40 research projects, while 350 case studies were developed, significantly enriching the Banks internal knowledge repository. Further strengthening academic and instructional capability, 140faculty members & research officers participated in Faculty Development Programs conducted by reputed institutions. Faculty achievements during the year also included completion of 1,039 external certification courses, publication of 307 articles in reputed journals, review of one academic book, and delivery of 216 academic and training sessions at leading institutions such as NIBM, NABARD, FORE School of Management, and BIRD.
At the employee level, continuous professional development remained a strong focus. 2,916 employees completed 4,043 external certification courses, while 3,460 employees completed 9,038 internal certification courses, reinforcing functional expertise and professional competence across the organization.
18.10 Digital Learning Enablement and Workforce Outreach
During the year, the Learning & Development Division implemented several strategic initiatives to strengthen learning governance, enhance quality, and ensure alignment with business priorities. All L&D units were certified under ISO 9001:2015 and ISO 21001:2018, reinforcing standardized and learner-centric quality systems. In addition, training on "AI, Gen AI, and Use Cases of Gen AI in Banking" was conducted for senior executives.
A Performance Improvement Plan (PIP) framework to be introduced to align learning outcomes with measurable business impact, while structured learning pathways for senior leadership and critical roles were finalized to support systematic succession planning.
The launch of a Digital Mentorship Program facilitated knowledge transfer and leadership grooming, and job cards developed for key field operations enabled the integration of SOPs and regulatory compliance into day-to-day execution.
Enhancements to the Learning Management System (LMS), including Post-Course Evaluation (PCE) and Quantitative Business Parameters (QBP), strengthened learning impact assessment, supported by comprehensive faculty and course audit mechanisms.
The Bank further reinforced its commitment to inclusivity through initiatives such as Sign Language Training.
To provide global exposure and flexible learning options, partnerships with Coursera and IIBF were renewed, enabling access to world-class certifications and e-learning support for JAIIB and CAIIB aspirants.
Digital learning adoption gained momentum through the E-Learnathon Campaign, achieving over 94% completion of mandatory e-learning among officers, supported by the launch of new and updated modules.
The Bank also expanded its micro-learning outreach through podcasts and radio broadcasts, internal certification courses, micro-bytes, short videos, job cards, and recordings of important webinars, while restructuring programs into Level I (Basic) and Level II (Advanced) formats to enable progressive skill development.
18.11 Special Learning Initiatives for Inclusive Capability and Service Excellence
During the year, the Bank implemented several special learning and capability-building initiatives aimed at inclusivity, operational readiness, and service excellence. These included the "Reconnect" program designed to support women employees returning from maternity leave through structured reintegration and capability enhancement.
Induction training was conducted for six batches of Local Bank Officers, ensuring early role readiness and alignment with organizational processes. To support career progression, Orientation Training Programs (OTP) were delivered to 6,780 officers and 3,027 clerical staff, strengthening functional and promotional preparedness.
Faculty capability was enhanced through a Train-the-Trainer program conducted in collaboration with Go Beyond, focusing on soft skills and customer interaction excellence. In addition, over 2,800 Business Correspondents were trained through a hybrid model in local languages, enhancing outreach effectiveness.
Employees posted outside their linguistic regions were provided local language training to improve customer engagement and service delivery.
Under the Rashtriya Karmayogi (CBC) Training Program on Seva Bhav, over 33,300 employees were trained through locational programs, reinforcing service orientation.
The SUCCESS programs were also conducted for frontline officers and Customer Service Associates, aligning service excellence with the Banks organizational goals.
18.12 Future-Focused Learning-
The Bank articulated a forward-looking L&D roadmap aimed at enhancing learning effectiveness and on-the-job applicability. Key focus areas include expanded digital learning, advanced certifications, succession planning for critical roles, improved learning management systems, and strengthened field enablement through standardized job aids.
18.13 Awards and Recognition
| Name /Category | Presented by (Organization Name) | Year |
| National Best Employer Brand 2025 | ||
| Innovative HR Practices 2025 | World HRD Congress | February 2026 |
| Excellence in Training Award | ||
| Excellence in continuous learning & upskilling Best Learning Experience Platform | Asia L&D Employer Branding Conference & Awards by International Business Conferences | February 2026 |
| Apex India HR Excellence Award 2025 | Apex India Foundation | November 2025 |
| Apex India Training Excellence Award 2025 | ||
| Digital Learning & upskilling initiative of the year | People Tech Summit Awards by International Business Conferences | August 2025 |
| Best HR Digital Transformation Initiative | ||
| Excellence in Learning & Development | International Business Conferences | May 2025 |
| Excellence in HR Digitisation |
18 .14 Official Language (RAJBHASHA)
RAJBHASHA and Publication of Magazine
Union Bank of India continues to emphasise the promotion & publicity and use of Hindi across its operations, ensuring compliance with the Rajbhasha guidelines and fostering a bilingual work environment. Here is an overview of initiatives and achievements in promoting the official language, Hindi.
Promotion of Hindi in Banking Operations
Union Bank of India actively promotes the use of Hindi in its daily operations. The Bank ensures that Hindi is used extensively in official communications, including internal circulars, notices, and reports. The Bank also encourages employees to use Hindi in their day-to-day work, fostering a bilingual environment.
Multilingual Publications
The Bank publishes various materials in Hindi to cater to a wider audience. Notable publications include the quarterly bilingual corporate in-house journal Union Dhara and the Hindi magazine Union Srijan. These publications feature articles, stories, and poems contributed by employees, promoting literature and culture within the organisation. During the financial year your Banks house magazine completed 50 years, special issues on its Golden Jubilee and on various important topics like Vikasit Bharat, EASE, Sports and Sportsmanship, Rajbhasha and GI Products were published.
Employee Participation and Training
Union Bank conducts regular training programs to enhance the Hindi proficiency of its employees. These sessions cover the effective use of Hindi in official documentation, communication, and customer interactions. Additionally, the Bank organises competitions and workshops to encourage the use of Hindi among employees. The bank has trained more than 500 staff members under the Union Bhasha Sauharda Indradhanush Programme to impart practical language skills to the staff members in South Indian Languages. The said training will help in establishing cordial relations with the customers.
Coordination of Town Official Language Implementation Committees (TOLIC)
The bank is fulfilling the responsibility of coordinating TOLIC assigned by the Government of India, Ministry of Home Affairs, Department of Official Language very well. In the Financial year 2025-26, the bank has handled the responsibility of coordinating 34 TOLICs across India. These TOLICs promote the use of official language while organizing meetings and competitions on time
Recognition and Awards
Union Banks efforts in promoting Hindi have been recognised with several awards. Bank has received total of 668 Rajbhasha Awards in the financial year. During the year your bank has received 2 Rajbhasha Kirti Puraskar, which is the highest institutional award in the field of Official Language. Your bank has earned the highest honors for Hindi house- magazine Union Srijan and for Official Language Implementation in the bank. Total 7 Regional Official Language Awards of the Government of India have been awarded by the Department of Official Language, Ministry of Home Affairs, Government of India for the best performance in implementation of Hindi to 3 TOLIC Convenor Offices of your Bank and 4 offices for excellent performance in Hindi implementation. The Department of Financial Services, Ministry of Finance, Government of India conferred Second Prize to the bank for its outstanding performance in the implementation of the Official Language Hindi during the financial year 2025-26. 11 TOLIC Convenor Offices of the Bank have been awarded certificates by the Government of India. Various offices and branches of the bank have received 97 shields from TOLICs. As many as 35 staff members of the bank have received awards in Hindi competitions held at the all-India level. The banks corporate house magazine Union Srijan has received the Silver Award & Union Dhara has received Commendation Certificate from PRCI. Union Srijan has received Ashirwad Shrestha Griha Patrika Puraskar.
Digital and Multilingual Support
Union Bank has made significant progress in providing multilingual support across its digital platforms:
• Mobile Banking: Available in 13 languages, ensuring accessibility for a wide range of customers.
Corporate Website and Internet Banking:
Available in 2 languages, enhancing user experience. Banks website can be read in 22 languages with the support of Bhashini AI.
• Call Centre: Supports 11 languages, offering personalised assistance.
• SMS Facility: Available in 13 languages, ensuring effective communication with customers
• Selected STP Journey: Available in Hindi and Indian languages which eases online loan approval process for customers.
• UVCON: Banks WhatsApp Banking service is available in 06 major Indian languages which gives our stakeholders a whole new experience of connecting with Bank.
Letter of thanks: Printed in 11 languages.
Official Language Implementation Committees
To monitor and promote the use of Hindi, Union Bank has established Official Language Implementation Committees (OLICs) at various levels. These committees regularly review the progress of Hindi implementation and suggest measures to enhance its usage in the Banks operations.
Publications and Knowledge Dissemination
Union Bank disseminates knowledge through its publications, which are released in multiple languages to cater different employees and customers. The publications cover banking updates, industry insights, and employee contributions, fostering a culture of knowledge sharing and inclusivity. During the financial year, the Bank has published useful booklets for customer interaction in Odia and Tamil. To increase the awareness of staff members and customers on cyber security a cartoon booklet titled "Digital Arrest" has been published in Hindi, Bangla, Malayalam, Kannada, Telugu & Gujarati. On Compliance and Ethics Week 2026 "Union Siddhant" magazine has been published in 10 Indian languages. Union Gist of Circulars are published in 9 Indian languages in addition to Hindi and English for convenience of reading by staff members. Procedural Literature on 2 topics viz., Ease and Union Support have been printed in 9 Indian Languages. Your Bank has published Hindi books titled "Union Bhasha Vaibhav" and "@2047- Vikasit Bharat ki sankalpna mein bankon ki Bhoomika".
19. Network
• The branch network of your Bank is widely spread across the country with 8,695 branches and 2 overseas branches (Sydney, Dubai DIFC) as on March 31, 2026. Out of these 59 percent of the branches are in rural and semi-urban centres.
• As on 31.03.2025 your bank was having total 8,619 branches and 02 overseas branches. During FY 2025-26 total 24 branches were rationalized and 100 new branches were opened .
The category-wise Branch Network on March 31st 2026 is as follows: -
| Row Labels | Rural | Semiurban | Urban | Metro | Grand Total |
| Total no. of Branches as on 01.04.2025 | 2,597 | 2,521 | 1,735 | 1,766 | 8,619 |
| Rationalised during F.Y. 2025-26 | 0 | -8 | -8 | -8 | -24 |
| Opened During F.Y 2025-26 | 27 | 44 | 20 | 9 | 100 |
| Change in Category by RBI | -1 +5 | -4 +9 | -12 +4 | -1 | -18 +18 |
| Total no. of branches as on 31.03.2026 | 2,628 | 2,562 | 1,739 | 1,766 | 8,695 |
Bank have a Network of 8656 ATMs across the country as on 31.03.2026. The Bank endeavours to maintain the highest uptime.
20. Information Technology
The Information Technology (IT) Functional Deployment Department plays a critical role in strengthening the organisations digital transformation agenda by ensuring the seamless implementation and optimization of technology driven processes across all business units. The department is responsible for translating strategic technology initiatives into operational frameworks that enhance system reliability, improve process efficiency and support regulatory compliance. It also oversees end user testing to ensure solution readiness and manages Change Approval Committee (CAC) and Change
Approval Board (CAB) processes to uphold robust control, approval and governance standards. With a structured approach to solution deployment, cross functional integration and technology governance, the department provides a strong foundation for scalable growth and long term value creation. Its establishment underscores the organizations commitment to building a future ready technology ecosystem that enables innovation, operational excellence, customer excellence and sustained investor confidence.
Union Bank of India is a leading public sector Bank with latest technology based robust IT systems. The Bank leverages modern technology as a foundational enabler to create seamless, flexible, and customer-centric banking solutions. As the business landscape continues to evolve, institutions are embracing transformation by harnessing data insights, automating, and digitizing processes to improve productivity, leveraging cloud platforms for scalability, and elevating engagement across employee and customer touchpoints. These shifts are redefining how organizations operate, compete, and deliver value in a rapidly changing digital economy.
In alignment with these evolving dynamics and to support business growth by capitalizing on emerging opportunities, the Bank has formulated a comprehensive Digital, Analytics, and IT Strategy for FY 2025-26.
Digital, Analytics & IT Strategy of FY 2025-26 has been designed to align technology initiatives with business objectives, driving growth, enhancing operational efficiency, and fostering innovation. In FY 2025-26, the Bank took steps to evolve from a product-centric approach to a customer-centric approach. In its quest to achieve this transformation, the Bank leveraged data analytics and customer insights to tailor services and products to individual needs. Enhancing digital channels, such as the Digital Business Platform, ensured seamless and intuitive customer interactions.
Key focus areas included enhancing Customer Experience & Service through digital transformation, strengthening Risk Governance and cybersecurity measures, improving data management for data-driven decision-making, and modernizing IT infrastructure for scalability and resilience. By concentrating on these strategic areas, the Bank aimed to leverage technology to achieve business goals, remain competitive, and deliver value to stakeholders.
In the fiscal year 2025-26, the organization achieved significant milestones across various domains, demonstrating its commitment to excellence and innovation. The infrastructure was bolstered, ensuring its resilience to meet the evolving demands of operations. The major milestones achieved in FY 2025- 26 under various categories are as follows:
20.1 Innovative Banking Solutions:
Bank has distinguished itself through its proactive adoption of emerging technologies, aimed at enriching the customer journey and overall experience. Bank has demonstrated unwavering commitment to prioritizing customer convenience and experience.
Various innovative Banking solutions/initiatives are as follows:
20.1.1 For Improved Customer Experience
a) Union Virtual Connect (UVConn) - WhatsApp Banking: Bank had launched UVConn -WhatsApp banking initiative as a conversational banking platform for its customers.
UVConn offers various services to both resident and non-resident customers through WhatsApp no. 9666606060 in 7 different languages. Additionally, AI based search option has been enabled in UVConn, wherein customers can access the required services by searching for service names e.g. "balance", "debit", "credit", "statement" etc.
b) VR based immersive training modules: Your Bank has also developed VR based immersive training modules to resolve various concerns such as tackling workplace challenges, maintaining secure social media presence etc. to enhance customer service. All the training modules have been inculcated with assessment through Q&A/ feedback pertaining to specific modules for evaluation. The training modules are a testament to banks commitment to continuous learning and improvement of staff members by leveraging emerging technologies to provide an immersive and interactive training sessions to the employees focusing on real world applications.
c) Hyperautomation: The Bank has adopted
Hyperautomation to reduce manual effort, enhance productivity, and enable optimal utilization of human resources across operations.
d) Bharat Connect (previously BBPS): Vector Finance, Shriram Finance, Himachal Pradesh Transport Department have been onboarded onto the Bharat Connect platform by the Bank.
e) Palm Attendance Solution: Staff as well as Vendor attendance has been made live on the palm attendance solution.
f) Uni Pay Plus: Uni Pay Plus is designed to integrate with Corporate Systems for Automatic Payment Processing. Uni Pay Plus portal is developed to provide payment services to Corporate Clients, CRCs are making use of this portal to get business from several Corporate Clients. 150+ Corporates are on-boarded on Uni Pay Plus till 31-03-2026.
g) Account Aggregator: Your Bank was the first public sector lender to go live on the account aggregator ecosystem as financial information user (FIU) & Financial Information Providers (FIP) both, a part of the governments digital initiatives to improve credit delivery. The account aggregator ecosystem helps lenders leverage digital data acquired with the customers consent to provide seamless service without physical documentation. Any financial information user (FIU) can request data based on a consent given by the customer on their account aggregator handle. Bank has implemented the technology stack as per the Reserve Bank Information Technology (ReBIT) guidelines.
h) Inclusive and Accessible Banking: Bank continued to deepen its commitment to inclusive banking in 2025-26, building on its flagship initiative Union Access to establish a governance-driven, institution- wide model of accessible financial services.
During the year, the Bank attained comprehensive digital accessibility compliance across its customer and employee-facing touchpoints, validated through expert-led audits ensuring zero-barrier digital journeys. Indian Standard (IS 17802) and global WCAG 2.1 guidelines were embedded into the architecture of the redesigned Corporate Website and the Central Bank Digital Currency (CBDC) mobile application, setting an Inclusive by Design benchmark for the Indian banking sector.
In a significant stride towards product innovation, the Bank launched the SPARSH Braille Credit Card and accessible touchscreen Point-of-Sale terminals ? market-first solutions that extend dignified and independent banking access to persons with disabilities.
The Banks leadership in accessible banking was recognised at the highest levels. Union Bank was honoured as a Role Model Organisation at the 16th NCPEDP-Mphasis Universal Design Awards. The Bank also showcased its model accessible infrastructure at the International Purple Fest 2025, Global Fintech Fest 2025, and IBA Expo 2026, reinforcing its position as an industry advocate for universal design.
Inclusive banking has been firmly embedded within the Banks ESG strategy ? transforming accessibility from a compliance imperative into a scalable driver of sustainable growth, aligned with Indias national financial inclusion agenda.
At Union Bank of India, inclusive banking is a leadership commitment rooted in the belief that true financial inclusion means dignity, independence, and equitable access for every customer the Bank serves.
Digital Business Platform: The Bank successfully implemented a comprehensive Digital Business Platform, enabling seamless and scalable interactions across multiple digital and assisted channels, and significantly enhancing agility in the evolving digital landscape.
As part of this initiative, various end-to-end liability journeys for Existing-to-Bank (ETB) customers and lending journeys like Vehicle Loan, Personal Loan were deployed across both Open Web and
Assisted Portals, delivering faster, more seamless, and customer-friendly digital onboarding and transaction experiences.
i) Data Lake: The Bank successfully set up a next-generation, state-of-the-art data infrastructure in the form of a centralized Data Lake to support advanced analytics. The Data Lake integrated structured and unstructured data from both internal and external sources, enabling improved data-driven decision-making and enhanced customer experiences.
The Bank also effectively leveraged data analytics to strengthen customer engagement, support informed decision-making, and reduce risks through descriptive analytics and multiple machine-learning-based use cases across key segments such as Retail, MSME, and Agriculture.
j) Digital Contact Center: The Bank successfully implemented a Digital Contact Center to ensure uninterrupted and seamless delivery of banking services while significantly enhancing customer experience. The initiative enabled personalized interactions, faster call resolution, improved customer connect, and quicker response times through effective use of advanced technologies.
The Digital Contact Center also expanded the Banks reach by supporting a wider customer base and successfully transitioning a significant volume of customer interactions from branch-based service to a centralized contact center model, thereby improving service efficiency and customer convenience.
k) Global Fintech Fest (GFF)
Global Fintech Fest is one of the largest fintech conferences, organized annually by the Payment Council of India (PCI), the National Payment Corporation of India (NPCI) and the Fintech Convergence Council (FCC). GFF is a preeminent platform for global policymakers, regulators, central bankers, fintech etc. Bank had participated as an exhibitor and booked a stall & showcased various banking products in Global Fintech Fest (GFF) GFF 2025 at Jio World Conventional Centre, BKC, Mumbai which was held from 7th to 9th October 2025, at the Jio World Convention Centre (JWCC), BKC, Mumbai. GFF2025s theme was "Empowering Finance for a Better World - Powered by AI. Bank showcased Metaverse, UVConn, Internet Banking, CBDC, Accessible POS, Sparsh Debit & other creatives over LED screens.
20.1.2 For Enhanced Governance
Bank is establishing comprehensive governance frameworks and practices to facilitate effective decision- making, risk management, and compliance with regulatory requirements, ensuring transparency and accountability across all levels of the organization.
Bank is having strong information security, data governance and privacy practices in place which are defined in the Information Technology Policy & Data Governance policy of the Bank. Additionally, Bank is certified with ISMS (Information Security management System), ISO 27001; Privacy Information Management System (PIMS) ISO 27701; Business Continuity Management System (BCMS) ISO 22301 and Enterprise Risk management System (RM) ISO 31000 standards. The ISO standard promotes a culture of continuous improvement and operational excellence by implementing well-defined processes and controls, ensure the security of our information assets and reinforce our commitment to excellence.
To demonstrate your banks commitment to the highest standards of information security and align it with banks strategic goals of maintaining trust and confidence among the customers, partners, and regulatory bodies, bank has upgraded ISO 27001 certification to its latest version ISO 27001:2022. The scope of ISMS practices has also been enhanced to include Cyber Security Centre of Excellence (CISO) and National Processing Centre (NPC) in addition to the existing IT Systems.
20.1.3 For Resilient Infrastructure
Building a solid foundation of infrastructure that is robust, adaptable, and resilient, ensuring uninterrupted operations and continuity even in the face of unforeseen challenges and disruptions.
(a) Data Centre Modernization
• Green Data Centre
Bank has set up a Green Data Centre, that can operate with maximum energy efficiency, reducing carbon emission and minimum environmental impact by using sustainable technologies and resource management.
• Multiple Architecture for CBS
Near Disaster Recovery site is successfully established to ensure zero data loss in case disaster at DR Site and to maintain business continuity. It benefits the Bank through improved customer service by achieving maximum availability and reduced data loss in case of disaster at DR Site.
• CBS modernization
The Bank is in the process of upgrading its Core Banking System from Finacle version 10.2.18 to 10.2.25, resulting in enhanced system performance, strengthened security features, and improved support for evolving business requirements.
(b) Next Generation Security Operation Centre
The Bank successfully upgraded its security posture by implementing a Next-Generation SOC, integrating advanced Security Information and Event Management (SIEM) capabilities with Artificial Intelligence (AI) and Machine Learning (ML).
The Next-Gen SOC enabled continuous, real-time monitoring of network traffic and security events, allowing intelligent analysis of patterns to identify anomalies and potential security threats at an early stage. This enhancement significantly improved the Banks threat detection, incident response speed, and operational resilience, thereby minimizing the impact of security incidents and strengthening overall cyber defence.
(c) Robust CBS & Cloud Infrastructure
Bank has automated DR Switching Operations for secured BCP using DR Automation tool. Additionally, the Bank leverages a comprehensive cloud infrastructure that includes Private, Hybrid, and Public Cloud environments. This multi-faceted approach allows the Bank to optimize resource utilization, enhance data security, and maintain flexibility in deploying applications and services. By integrating these advanced technologies, the Bank ensures a superior customer experience, operational efficiency, and the agility to adapt to evolving market demands.
(d) Real Time performance Monitoring through APM Tool
IT Resilience Centre of Excellence (ITRCoE) at CO Annex, Hyderabad is a single integrated Application Health & Performance management solution for all servers/devices and application monitoring needs - end user applications and underlying infrastructure components such as application servers, databases, web servers, virtual systems, and cloud resources.
Bank is using HEAL APM Tool for Real time monitoring of the applications and its infrastructure.
(e) Software Defined Network:
Bank has migrated its DC, NDC and DR from traditional network structure to SDN Fabric to ease the network operations and improving security. The following benefits are achieved:
• Centralised Monitoring and control of Network Devices /Routers.
• Capability to monitor and analyse the Data Traffic.
20.2Other Major Initiatives for Improved Performance: App Modernisation
To adopt Agile methodology while keeping security at the core, Bank has established an end-to-end DevSecOps platform integrated with a Container Orchestration Layer (Kubernetes platform) on Banks on premises private cloud. Bank has adopted an Application Modernization platform based on Kubernetes and DevSecOps principles for the development and deployment of microservices based banking applications. Microservices architecture enables scalability, resilience, faster time-to-market, and independent lifecycle management of application components.
The adoption of microservices has enabled Bank to:
• Modernize existing monolithic applications
• Leverage cloud-native capabilities
• Develop market standard applications aligned with the latest software development methodologies and industry best practices.
21. Risk Management
Risk management is the strategic process of identifying, assessing, and mitigating uncertainties that could affect an organizations objectives. Its critical role became increasingly evident as global financial markets evolved, leading to heightened complexity and volatility.
Your Bank has a proactive approach towards risk management. Its risk philosophy involves developing and maintaining a healthy portfolio within its risk appetite and regulatory framework. Your Bank constantly endeavours to ensure that business function partners with the risk management function to enhance shareholder value and to ensure judicious use of available capital.
The Board of Directors is the apex body with sub- committees of the Board i.e. Risk Management Committee of Board (RMC) and Special Committee of the Board for Monitoring and Follow-up Cases of Frauds (SCBMF) to oversee various Risk Management activities. The Bank also has separate Committees of Top Executives i.e., Credit Risk Management Committee (CRMC), Asset & Liability Committee (ALCO), Operational Risk Management Committee (ORMC), Group Risk Management Committee (GRMC), BCP committee, FMG (Fraud Monitoring Group) and ESG Steering Committee to deal with Credit, Market, Operational, Group Risk, BCP, Fraud Risk and ESG respectively. Further, the bank has Risk Management Organizational Structure in place with units at Regional /Zonal Offices. The risk strategy and policies are effectively communicated to all branches and offices of the Bank. The broad risk management organizational structure of the bank is furnished as under:
Your Bank addresses Credit, Market and Operational risk through appropriate policies, organization structure, risk management techniques, adequate systems and procedures, monitoring and reporting mechanisms. Your Bank has created a dedicated ESG Cell to incorporate ESG risks-related considerations in strategies and objectives, integrating ESG risks in governance structures and implementation of various ESG aspects. Your Bank has also created dedicated Vendor Risk Management Cell to mitigate risks arising from third party vendors due to outsourcing of various functions. IT Risk Management Cell has been set up to ensure banks operational resilience against IT risks and compliance with regulatory guidelines.
Risk management activity in your bank has also been extended to field level units by posting Risk Officers at Zonal Offices and Regional Offices. Primary responsibility of these Risk Officers is to identify, assess, monitor and report risk in their region/Zone and suggest mitigants.
Your Bank has a well-defined risk appetite statement and an independent risk function to ensure that the Bank operates within its risk appetite.
Your Banks Risk management principles and processes across all functions and operations are in alignment with ISO 31000:2018 - Risk Management - Principles & Guidelines.
21.1Credit Risk Management
Credit risk management involves identifying, assessing, and mitigating the risk of financial loss due to borrowers failure to repay a loan or meet contractual obligations. It ensures to maintain asset quality and capital adequacy through effective risk controls and monitoring.
Your Bank has well-defined credit appraisal mechanisms and risk management frameworks in place for identification, measurement, monitoring and control of the risks in credit exposures. In your Bank, overall responsibility of managing credit risk lies with the Credit Risk Management Committee (CRMC). The CRMC meets regularly for portfolio analysis, setting and monitoring exposure ceilings, reviewing rating and scoring models, identifying stress sectors etc.
Your Bank has various instruments like Credit Risk Management Policies, Prudential Exposure Limits, Risk
Rating system, Risk Based Review of Credit Appraisal (RBRCA) for big ticket advances and Risk-based pricing for Credit Risk/Portfolio Management. Your Bank has a standardised and well-defined approval process for all advances. It adopts a committee approach for credit sanctions and has credit approval committees at various levels.
Your Bank also has dedicated Credit Policy Cell for formulating, implementing, and updating policies and guidelines that govern banks credit related activities. The primary objective is to ensure that the banks lending practices align with regulatory and statutory requirements, risk management principles, and the banks strategic goals. Credit policy team is also an integral part of product development and innovation. It collaborates with other verticals in designing new loan products & for modification in existing products based on market needs and credit trends.
Your bank has also subscribed to industry research/ analysis reports from top research companies for internal consumption. Risky sectors are monitored continuously and wherever warranted; exposure concerned is reviewed immediately.
Your Bank also conducts Stress Tests every quarter on its Credit portfolio. Stress Scenarios are regularly updated in line with RBI guidelines, industry best practices and changes in macroeconomic variables.
Your Bank has put in place an Early Warning Signal (EWS) system based on a predictive analytical approach, which helps to identify the stress signals well in advance and helps to take appropriate mitigation measures to maintain the desired credit quality of borrowers on a regular basis.
Your Bank uses various Credit Risk Assessment Models and scorecards for assessing borrower-wise credit risk. Your Bank also has in place a Dynamic Rating framework, which facilitates early identification of stress and triggers and adoption of appropriate mitigation mechanisms. Bank has also introduced the Risk Based Review of Credit Appraisal Framework is in place for large value accounts to strengthen the loan underwriting.
Your Bank has adopted an IT platform for credit appraisal processes through Lending Automation Solutions (LAS).
Internal Rating models are hosted on these platforms, which are interfaced with CIBIL, RBI defaulters lists etc.
While arriving at Banks CRAR, capital charge on credit risk is computed based on Standardized approach.
Your Bank has adopted the RAROC Framework for optimal risk-reward considerations, wherein RAROC computation for all fresh sanctions/reviews/renewals of Agriculture, MSME and Corporate proposals above a certain cut-off limit is mandatory. Credit decisions related to the concession in Rate of Interest (ROI) are linked to the RAROC framework which help in maintaining profitability of the bank and value creation for the stakeholders. While taking decision on pricing of loan, RAROC framework is used to assess risk adjusted profitability from individual transaction, which helps the bank in ensuring sustainable profitability and value creation for the stakeholders.
21.2 Operational Risk Management
Operational Risk is the risk of loss resulting from inadequate or failed internal processes, people, and systems or from external events. Effective management involves identifying risks, implementing controls, and monitoring to minimize financial and reputational impact.
To manage operational risks, your bank has put in place a comprehensive Operational Risk Management Framework (ORMF), whose implementation is supervised by the Operational Risk Management Committee (ORMC) and reviewed by the Risk Management Committee of the Board. The primary goal of ORMC is to mitigate operational risk by establishing a structured risk management process within the bank.
An independent Operational Risk Management Cell implements the framework. Under the framework, the Bank has three lines of defense. The first line of defense is the business unit (including support and operations) which is primarily responsible for managing Operational Risk on a day to day basis. The second line of defense is the Risk Management Department and Compliance Department, which develops policies, procedures and techniques to assess the risk and monitor the effectiveness of your Banks internal controls. Audit & Inspection is the third line of defense.
The team reviews the effectiveness of governance, risk management and internal controls within your Bank. The comprehensive systems and procedures, internal control system and audit are used as primary means for managing Operational risk. The bank has in place a Board approved Operational Risk Management Policy based on Reserve Bank of India guidelines.
All new products/ processes introduced by the Bank pass through a Product & Process Risk Evaluation Committee (PPEC), this process helps to identify and address the operational risk issues.
Your Bank is currently following the Basic Indicator Approach (BIA) for capital computation under Operational Risk. Your Banks ORMF quantifies Operational Risk through internal and external loss data, near miss events, key risk indicators and qualitative assessment of controls.
Your Bank has compiled data relating to operational losses incurred during the last eighteen years, and it is analyzed for taking corrective measures so that these types of losses can be minimized. For FY 2025- 26, the total operational loss amount is Rs. 49.19 Crore. Major incidents were reported in Retail Banking, which accounts for 98.86% of total loss amount and 95.25% of total incidents. Apart from this, Agency Services contributes 0.84% to the loss amount and 4.40% to the total incidents. Based on loss event types, while External Fraud (50.55%) and Internal Fraud (25.94%) contribute the most in terms of loss amount; Execution, Delivery & Process Management (59.15%) and External Fraud (20.60%) are major contributors in terms of number of loss events. The process has also been put in place to conduct Risk and Control Self-Assessment (RCSA) for assessing the residual risks in the products/ processes of the Bank. Key Risk Indicators (KRIs) have been identified for various processes, and the threshold limits have been fixed.
Your Bank has put in place many mitigants both in credit and non-credit areas for prevention of frauds and strengthening of existing systems. These include setting up of Early Warning Signals (EWS) package for monitoring of advances portfolio, Enterprise Fraud Risk Management Solution (EFRMS) for transactions monitoring and transactions surveillance through Off-site Monitoring Cell. For Monitoring of suspected frauds through UPI and AePS channels, your Bank has been using NPCIs EFRM Solution for effective monitoring.
To strengthen risk culture across the organization, your Bank has been publishing a bilingual risk awareness bulletin, Union Sachet to sensitize staff about the emerging and real-world risk events. The bulletin includes risk events, including major operational risk events, fraud cases, cyber incidents, operational losses, IBA-reported incidents, and relevant regulatory observations.
Your Bank has also implemented a structured, role- based Risk management training framework to systematically enhance risk competencies and embed a strong risk culture across the organization. This includes an Induction Training Program for new Risk Officers, a Risk officers Orientation Program for identified Field Risk Officers with practical, hands-on exposure, and a specialized training program for Officers and Executives at Central Office covering a wide spectrum of risks along with regulatory and supervisory expectations. By combining conceptual understanding with practical application and regulatory focus, these programs strengthen risk ownership, improves consistency in risk assessment, and aligns staff capabilities with the Banks strategic risk appetite and governance standards. In addition, your Bank has also organised staggered training programmes for risk officers and other front- line officers. These initiatives, combined with proactive escalation of early warning signals and risk-informed actions, reinforce a strong, sustainable, and mature risk culture across the organization.
21.3 Business Continuity Plan (BCP)
Your Bank has a robust Business Continuity Plan (BCP) and Disaster Recovery Plan (DRP) that is periodically tested to ensure that it can meet any operational contingencies. A well-documented Board approved Business Continuity plan is in place to minimize business disruptions and system failure, and potential impact on its business, employees and customers during any unforeseen adverse event or circumstances. The plan is designed in accordance with the regulatory guidelines and is reviewed regularly.
Your Bank has also constituted a BCP Quick Response Team (QRT) for IT and Non-IT related Disruptions. QRT monitors the disruption and gives necessary directions to various Verticals/fields and also monitors the situation till normalcy is restored. Further, QRT shall take decision regarding invocation of BCP and accordingly the BCP Committee meeting is convened to take an appropriate decision.
Your Bank has BCP Committee responsible for exercising, maintaining, and invoking the BCP as required. The Committee meets quarterly to review BCP preparedness. The review outcomes are subsequently placed before the RMC and the Board.
21.4Asset Liability Management (ALM)
Asset Liability Management (ALM) is a core strategic discipline that enables the Bank to effectively manage liquidity and interest rate risks by dynamically aligning the composition, tenor, and structure of its assets, liabilities, and off-balance sheet exposures. The primary objective of ALM is to establish a robust and integrated framework that optimizes the Banks risk-return profile while ensuring resilience under both normal and stressed market conditions.
Your Bank maintains a well-diversified and stable funding base, anchored by a strong deposit base, thereby minimizing reliance on volatile or short-term funding sources. This disciplined approach enhances balance sheet stability and supports sustainable growth.
The Asset Liability Committee (ALCO) is entrusted with the overall responsibility for ALM. ALCO meets regularly to review and determine the optimal size, mix, tenor, and composition of assets and liabilities. It plays a pivotal role in identifying, measuring, monitoring, and managing liquidity and interest rate risks. Additionally, ALCO oversees the pricing of assets and liabilities, ensuring alignment with prevailing market conditions and the Banks strategic objectives. Its decisions are driven by the dual objective of enhancing earnings performance while safeguarding the economic value of equity.
Your Bank adopted a dynamic approach to managing interest rate risk, with periodic review of deposit rates and benchmark lending rates, taking into account evolving funding costs and market dynamics. This enables timely and effective transmission of interest rate changes, thereby protecting margins and ensuring competitiveness.
During the year, in response to a cumulative 125 bps reduction in the Repo Rate by RBI, Your Bank proactively adjusted its External Benchmark Lending Rate (EBLR) by an equivalent magnitude, reinforcing effective monetary policy transmission while supporting borrowers and maintaining competitive positioning.
Your Bank has a comprehensive ALM Policy framework that governs the management and mitigation of liquidity and interest rate risks across both the banking and trading books. It emphasizes proactive liquidity management through robust monitoring systems, stress testing under multiple scenarios, behavioural analysis of assets and liabilities, and a well-defined contingency funding plan.
In line with regulatory expectations under the Basel III framework and RBI guidelines, Your Bank has implemented liquidity risk management standards, including Intraday Liquidity Management, Liquidity Coverage Ratio (LCR), and Net Stable Funding Ratio (NSFR). During the year, the Bank consistently maintained LCR and NSFR well above regulatory thresholds, on a solo basis as well as on a consolidated basis underscoring its strong liquidity position and prudent risk management practices.
The average LCR for FY2025-2026 is 124.13%. The NSFR Position as on 31st March 2026 is 115.34%. Liquidity risk is also continuously monitored through both stock-based and flow-based approaches to ensure comprehensive coverage.
Interest Rate Risk in the Banking Book (IRRBB) arises from mismatches between rate-sensitive assets and liabilities, which may impact the Banks Net Interest Income (NII) and the economic value of equity (EVE). The Bank employs a suite of analytical tools to measure and manage IRRBB, including Traditional Gap Analysis, Earnings at Risk (EaR), and Duration Gap Analysis.
The short-term impact of interest rate movements on earnings is assessed using the Earnings at Risk approach, incorporating various interest rate scenarios. The long- term impact is evaluated through sensitivity analysis of the Market Value of Equity, ensuring that potential adverse movements in interest rates are effectively captured and managed.
Overall, the Banks disciplined and forward-looking ALM framework enhances financial stability, supports sustainable profitability, and strengthens stakeholder confidence by ensuring prudent management of balance sheet risks.
21.5Market Risk Management
Market Risk denotes the potential risk of diminution in earnings or erosion of economic value arising from adverse movements in market rates or the prices of instruments. The fluctuation in the economic value of various market-linked products is predominantly attributable to changes in key macroeconomic variables, including but not limited to interest rates, foreign exchange rates, economic growth indicators, and prevailing business confidence levels.
Market Risk is governed through a comprehensive framework of Board-approved policies encompassing the Investment Policy, Market Risk Management Policy. These policies establish well-defined risk parameters across investment portfolio and asset classes by instituting risk limits and triggers to ensure the prudent and efficient deployment of investment funds.
In your Bank, overall accountability for managing market risk rests with Asset Liability Committee (ALCO). Mid office serves as the organisational mechanism for Market Risk Management, continuously monitoring position exposures relative to approved limits. Mid office reports directly to the Chief Risk Officer (CRO) and furnishes the ALCO with essential data and inputs on market risk.
Your Banks Risk control framework incorporates a broad spectrum of measures, Mid-Office as a part of Risk Management, measures and monitors interest rate risk including position limits, gap limits and sensitivity- based limits such as PV01, Modified Duration, Value-at- Risk (VaR), Stop Loss Trigger Levels, Net Open Options Position (NOOP), Foreign Exchange Daylight Limits and Aggregate/Individual Gap Limits (AGL/IGL). All such measures are subject to daily monitoring. Risk limits are further subject to periodic review in alignment with the Banks prevailing risk appetite set forth in ICAAP Policy.
Value-at-Risk (VaR) serves as a complementary quantitative instrument to stress testing, providing an additional measure of potential losses inherent in the Banks trading positions, which is being back-tested on a daily basis. In addition, Stressed VaR for Market Risk is calculated daily and is augmented by a Board-approved Stress Testing Policy and Framework, which simulates a range of Market Risk scenarios to assess stress-induced losses and facilitate the timely initiation of remedial measures.
The Market Risk Capital Charge is determined in accordance with the Standardised Measurement Approach (SMM), applying the regulatory risk factors as prescribed by RBI. Your Bank conducts risk analysis and comprehensive assessments of its investment portfolios on quarterly basis. As a matter of sound risk governance forward-looking analyses are also being performed by duly evaluating prospective Interest Rate Risk scenarios and their potential impact on the Banks trading portfolio.
21.6Internal Capital Adequacy Assessment Process (ICAAP)
Your Bank also conducts a comprehensive Internal Capital Adequacy Assessment Process (ICAAP) wherein the material risks faced by the Bank are listed, and their measurement and management methodologies are enumerated. Besides the Pillar-I risks, the Pillar-II risks are also assessed. The adequacy of the capital under normal & stressed conditions to meet future business requirements are also assessed.
Your Bank review ICAAP framework every year, the framework ensures Bank maintain sufficient capital for risks. ICAAP validation is performed annually by a Validation Committee. Scope of ICAAP includes:
• Risks partially or not captured under Pillar 1
• Assessment methods for different types of risks.
• Estimating capital needs under stress scenarios (Stress Testing).
• Capital requirements for future growth (Risk Appetite Statement)
Your bank has board approved capital plan for capital needs, desired levels, utilization and contingency measures. Your Bank integrates capital planning with business growth, ensuring optimal utilization and regulatory compliance. Staff is trained on capital management, and stress testing is conducted to assess potential risks. Capital is raised proactively based on projected business requirements.
21.7ESG & Climate Risk
ESG refer to environmental, social, and governance factors that can impact a financial institutions long-term performance and resilience and managing these risks involves integrating sustainability considerations into risk frameworks to address issues like climate change, regulatory shifts, and reputational impacts.
Your Banks Board has acknowledged the need to address the impact of ESG & Climate change risk. Risk
Management Committee looks into all the ESG & Climate Risk related matters of the Bank. The Bank constituted ESG Steering Committee (ESGSC) for overseeing ESG transition in the Bank. The Bank has formulated a Board approved ESG Risk Framework & Climate Risk Policy. The Bank has also formulated a Board approved sustainable financing framework to cover resource mobilisation & financing framework and aspects related to assurance.
Your Bank has established a separate ESG Cell to act as a nodal department for ESG related risk & opportunities. The Bank has identified vertical wise ESG related action points and timelines. A Sub-committee has been formed comprising of verticals looking after the premises of the Bank, Information Technology & Operations to formulate action points to achieve net zero emission in the Banks own operations. Further, another Sub- committee has been formed under the credit verticals of the Bank which will be the driving force behind transition of the credit portfolio of the Bank towards sustainable/ green finance. The Committee is working on finding out new avenues and opportunities for sustainable finance by measuring & mitigating the percentage of credit exposure to carbon-intensive sectors. The Bank has started assessment of physical risk and transition risk using financed emission in credit underwriting, identified physical risk of collaterals at district level of granularity and has also evaluated physical and transition risk for corporates at customer level under different climate scenarios.
In order to enhance transparency, accessibility and consistency of ESG related disclosures, your Bank has created a dedicated ESG section on its official website for Banks ESG disclosures, policies, frameworks, sustainability initiatives, climate risk approach and key milestones.
The Moodys Ratings has assigned a second highest rating on Sustainability Quality Score (SQS) i.e. SQS2 to your banks Sustainable Financing Framework, which indicates a "Very Good Sustainability Quality" and alignment with international market principles.
Further, your Bank has received independent recognition for its ESG performance from CareEdge ESG Ratings, which has assigned the CareEdge ESG 1+ rating to the Bank, representing a Leadership position in managing ESG risks through best in class disclosures, policies and performance across Environmental, Social and Governance parameters.
Your Bank has become the first major Bank in India to become signatory to the Partnership for Carbon Accounting Financial (PCAF), which has provided the bank access to the PCAF database and methodologies. The Bank has also signed MoU with the Council on Energy, Environment and Water (CEEW), which provides access to advanced modelling and scenario analysis tool namely Global Change Analysis Model (GCAM) India model developed by CEEW. Your Bank has also signed MoU with the Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ), for technical assistance and capacity development. These partnerships with international organisations demonstrate your banks strong ESG and climate commitment. Your Bank has also started integrating Climate Risk Solution in its lending operations. The Bank has also started integration of ESG related topics in its training programmes.
As part of stakeholder engagement activity, your Bank has organised the "Union Bank Climate Dialogue" during inaugural Mumbai Climate Week - 2026, by bringing together climate experts, industry leaders and financial institutions to deliberate on climate transition pathways and the role of the banking sector in Indias low carbon transition.
Your Banks training centre at Bangalore "Union Bank Knowledge Centre" has been certified with Platinum rating by Indian Green Building Council (IGBC). Your Bank has launched several products such as Union Green Home, Union Green Vehicle, Union Green Deposits promoting sustainable development
Your Bank is implementing an end-to-end Climate Risk Management Solution covering risk identification, measurement, monitoring and reporting.
Your Bank is working towards setting a time-bound quantitative target for reduction in emissions/ emissions intensity and carbon neutrality. Your Bank has set Net Zero target in Own Operations by 2035. Your Bank is well aligned to national goals and targets in the nations collective transition to a low carbon economy.
21.8Vendor Risk Management Cell
Third-party vendors have become integral part of banking operations. Over time, bank has recognized that outsourcing is a critical function within the bank. Risk and failures at a vendor can directly impact a banks operations, financials, customers, and reputation.
Bank has established a dedicated Vendor Risk Management Cell within RMD, for managing risks arising from outsourcing activities. To manage outsourcing risk, the Bank has board approved Vendor Risk Management policy in place.
Centralized data base of vendors is managed by Bank through inhouse portal called "Centralized Vendor Risk Management System" (CVRMS). Your bank has deployed outsourcing lifecycle in CVRMS for the effective monitoring of vendors. Your Bank is regularly reviewing its vendors and their services once at pre- onboarding stage and thereafter on periodic basis post- onboarding. Review of Service providers includes Activity Classification, Inherent Risk Assessment, Due Diligence, Enhanced Due Diligence, Cyber Risk Assessment, Due Diligence and Police Verification of Vendor Employees, Key Performance Indicator, Business Continuity Plan and ESG (Environment, Social and Governance) Assessment. To ensure the vendor maintains adequate security measures at operating environment and required BCP in place. Your Bank has a system to inspect the vendor site on regular basis.
21.9IT Risk Assessment Cell
Your Bank has IT Risk Assessment Cell under Risk Management Department to support the banks Operational Risk Management function by evaluating technological changes, new implementation, and customizations to ensure that IT-related risks are getting identified, assessed, and managed at initial stage of product development. The Cell operates under the direct oversight of the Chief Risk Officer (CRO).
Your Banks IT Risk Assessment Cell collaborates with key stakeholders, including DIT (Department of Information Technology), CISO (Chief Information Security Officer), Compliance, Audit, and Digitization verticals, to ensure a comprehensive approach to IT risk management and comply with RBI guidelines, banks internal policies and IT Governance framework.
The IT Risk Assessment process includes, Risk Identification, Risk Evaluation, Risk Prioritization, Risk Mitigation, Control Effectiveness, Change Identification and Assessment, Periodic Review of Business Impact Analysis (BIA) reports.
21.10Fraud Risk Management
Banking operations, by their inherent nature and operating environment, are exposed to various fraud risks. Rapid business expansion, if not supported by robust governance standards and effective internal control mechanisms, may increase vulnerability to fraud incidents. Recognizing these risks, the Bank has established a strong fraud risk management framework aligned with regulatory expectations and industry best practices.
The Bank continuously strengthens its operational processes, control architecture, surveillance systems and review mechanisms to address evolving fraud risks and emerging threats. Focused measures are undertaken to enhance awareness, reinforce accountability and improve resilience against both internal and external frauds. In line with the guidelines issued by the Reserve Bank of India, the Bank has implemented as comprehensive Board approved Fraud Risk Management Policy covering prevention, detection, investigation, monitoring and reporting of frauds
The objective of the framework is to safeguard the Banks assets, reputation and stakeholder interests through strong internal controls, proactive risk management practices and timely corrective measures, thereby minimizing potential financial and operational losses arising from fraud incidents.
Oversight of the fraud risk management function is undertaken by the Special Committee of the Board for Monitoring and Follow-up of Cases of Frauds (SCBMF). SCBMF reviews and monitor cases of frauds, including root cause analysis, and suggest mitigating measures for strengthening the internal controls, risk management framework and minimizing the incidence of frauds.
The Banks fraud risk management approach encompasses preventive vigilance, early warning and detection systems, investigation and recovery mechanisms, staff accountability, continuous monitoring, analytics-driven review processes and regulatory reporting, ensuring a comprehensive and proactive approach towards fraud risk mitigation.
21.11Group Risk Management
Your Bank, through its group entities, participates in diversified financial services including asset reconstruction, asset management, banking, insurance, and retail asset businesses. These entities contribute to the consolidated financials and overall strategic objectives of the Bank. Group Risk assesses the risk profile of group entities, identifies potential contagion risks to the parent bank and ensures effective oversight and capital planning at the consolidated level.
Your Bank has put in place a framework/ policy for assessment of risks for its Group entities, internal controls, mitigants and capital assessment under normal and stressed conditions. In line with regulatory expectations and internal risk governance standards, a structured risk assessment of these entities is undertaken periodically, and significant risks are reported to the RMC. A periodic and structured risk assessment of group entities is crucial to maintaining the financial stability and risk resilience of the Bank at the consolidated level. Your Bank shall continue to strengthen its consolidated risk monitoring framework and ensure proactive engagement with its group entities to address emerging risks.
21.12Enterprise Risk Management (ERM)
Enterprise Risk Management (ERM) is a structured approach adopted for identifying, assessing, managing, and monitoring risks across the organization. Unlike traditional risk management, which often focuses on specific threats in isolation, ERM provides a holistic framework that integrates risk considerations into strategic decision-making. ERM is a process of addressing these risks on a bank-wide level instead of managing in silos.
Your Bank has put in place an ERM framework which enables the Bank to gain a clear view of its overall risk level. ERM is designed to address a broad range of risks, including financial, operational, strategic, regulatory, and reputational risks. Your Bank has a Board approved Enterprise Risk Management policy in place.
21.13Transaction Monitoring
Your Bank has a dedicated Transaction Monitoring Division to strengthen its transaction surveillance capabilities, enable early detection of emerging fraud patterns and typologies employed by perpetrators, and ensure the timely implementation of robust control measures for effective risk mitigation.
Your Bank has deployed real-time and near real- time transaction monitoring systems aimed at the continuous surveillance of customer transactions across channels. These systems are designed to detect and mitigate transaction-related fraud risks both at the point of transaction processing and through post-facto analytical review, thereby strengthening the Banks fraud risk management and control framework. Under this monitoring framework, all categories of accounts as well as those reactivated from dormant status are subjected to continuous, round-the-clock (24x7) transaction surveillance.
In addition to adhering to regulatory guidelines and ongoing strategic initiatives, your Bank has developed in house machine learning models designed to proactively identify suspected cyber fraud and potential money mule accounts. Furthermore, your Bank has established a partnership with RBIH (Reserve Bank Innovation Hub) Machine Learning Model Mule Hunter to enhance its capability for identifying suspected money mule accounts. Your Bank also leverages regular intel received from external agencies such as DoT (Department of Telecommunications), NPCI (National Payments Corporation of India) , and NCRP (National Cybercrime Reporting Portal) etc. for identifying high- risk and suspicious accounts. Additionally, your Bank has established integration with the Department of Telecommunications (DoT) Digital Intelligence Platform (DIP) for ingestion of Financial Risk Indicator (FRI) and Mobile Number Revocation List (MNRL) data, which is being utilized to support the identification of suspected accounts. This measure has significantly strengthened your Banks customer protection framework by enabling the proactive identification and swift remediation of mule accounts, thereby mitigating the risk of genuine customers inadvertently becoming victims of cyber fraud.
Transaction Monitoring also has a full-fledged cybercrime cell at Hyderabad working on 24*7 basis to handle the cybercrime complaints on the CFCFRMS (Citizen Financial Cyber Fraud Reporting and Management System) of the NCRP (National Cybercrime Reporting Portal) Portal of I4C (Indian Cyber Crime Co-ordination Centre), Ministry of Home Affairs, Government of India. The framework ensures time-bound resolution, mandates coordination between Banks and Law Enforcement Agencies, and provides relief to customers, including removal of holds or restoration of services, subject to due verification and regulatory compliance, while also allowing recourse to judicial authorities wherever required.
These initiatives, positions your Bank as a pioneer in the Indian Banking Industry, enhancing fraud detection, efficient handling of cybercrime complaints and mitigation capabilities.
22. Compliance
22.1 Strengthening Compliance Framework and Governance
The bank is maintaining highest level of compliance culture and adhering to all regulatory and ethical standards of doing its business. A high-level Assurance Forum, comprising the heads of the Assurance Verticals is constituted to periodically review key compliance issues, emerging risks, and implementation of significant regulatory directives. This integrated approach ensures a coordinated and proactive response to compliance and risk management challenges. The Bank also strengthened its compliance architecture across field level through focused monitoring and adherence to regulatory requirements.
22.2Compliance Risk Assessment Framework
The Bank undertakes annual Compliance Risk Assessment (CRA) to assess adherence to RBI regulations, identify key compliance risks, and recommend appropriate mitigation measures, thereby ensuring ongoing regulatory compliance and risk minimization. Zonal Compliance Risk Assessments are conducted on quarterly basis to enable granular evaluation and improvement of field level compliance
22.3Embedding a Strong Compliance Culture
The Bank has undertaken sustained initiatives to foster a strong compliance culture across all business and operational units. Structured training programmes are regularly conducted to enhance regulatory awareness and build employee capability at all levels. In addition, compliance awareness programmes are conducted across the bank on a regular basis to strengthen understanding of regulatory guidelines. These initiatives ensure that field-level functionaries remain adequately sensitized to regulatory requirements and adhere to the same in letter and spirit. To further strengthen accountability, compliance-related Key Result Areas (KRAs) have been assigned increased weightage in the performance evaluation framework. These initiatives reinforce the guiding principle of "Business First, Compliance Always."
22.4Ethics & Compliance Week 2025-26
The Bank successfully organised Ethics & Compliance Week from January 01 to January 07, 2026, with active participation across all levels. The program included a series of activities for engaging with employees, such as, Leadership Engagement through podcasts of Executive Directors, CGMs and Zonal Heads released in social media, publication of the Compliance Magazine "Union Siddhanta", conducting expert led Webinars and Study Circles, Walkathons, Town Hall Meetings, Essay & Crossword competitions and rewarding the top performing Zones, Regions and Branches. These initiatives have further strengthened compliance awareness, enhanced employee engagement, and reinforced ethical conduct across the Bank.
22.5Compliance Monitoring and Control Mechanisms
The Bank conducts periodic compliance test checks across Central Office Departments, Controlling Offices, and branches to assess the effectiveness of regulatory adherence. Bank has clearly defined roles and responsibilities across the Compliance Function and a robust self-certification framework is instituted to facilitates effective compliance validation at all levels. All communications and directives from regulatory and statutory authorities are centrally monitored through a digitized compliance package
22.6Technology-Enabled Compliance
As part of its digital transformation initiatives, the Bank has implemented Comprehensive Compliance Application (CCA) for end-to end compliance solutions and monitoring across the bank. The solution comprises integrated modules for compliance tracking, monitoring, obligation management, testing & certification, submission of regulatory returns and comprehensive dashboard for the top management. This technology- driven solution enhances transparency, strengthens accountability, and enables real-time monitoring across the organization.
22.7Integration of Compliance with Business Strategy
The Compliance framework and culture is embedded with the Banks core business strategy and decision- making processes. Regulatory requirements are integrated into product design, policy formulation, IT systems, and digital lending operations. System-driven controls and checks have been institutionalised to ensure consistent and scalable compliance. Enhanced emphasis on transparency, governance, and disclosures continues to strengthen stakeholder confidence and align with evolving regulatory expectations.
The Bank remains committed to continuously strengthening its compliance, risk management, and governance frameworks. Ongoing efforts are focused on aligning practices with evolving regulatory requirements and industry best standards, thereby supporting financial stability, operational resilience, and long-term institutional integrity.
23. Internal Audit
The Bank has established an independent Internal Audit mechanism supported by well-defined procedures, instructions, and systems framed in line with regulatory, statutory, and internal guidelines. The Internal Audit function is designed to provide independent and objective assurance on the adequacy and effectiveness of internal controls and compliance with applicable requirements. It facilitates systematic evaluation of risk management processes and ensures that identified risks are mitigated to acceptable levels, thereby supporting the Bank in achieving its stated objectives and maintaining sound governance standards.
Allocating Audit Resources in accordance with Risk Profile/Assessment. Monitor adherence to internal controls - both administrative internal controls and accounting internal Controls.
RBIA aims at adherence to procedures, internal controls and regulations. RBIA enables the Bank to accomplish its objectives by a systemic and disciplined approach to evaluate and improve effectiveness of risk management, control & governance.
Overview of Audit Functions in the Bank:
Following key activities are carried out by the Audit & Inspection vertical:
1. Risk based Internal Audit (RBIA) of Branches and other units
2. Concurrent Audit of select Branches and other units
3. Management audit of controlling offices and CO Verticals
4. Information Security Audit of IT application & Process
5. Foreign Branches Audits
6. Special Audits and Special Reports
Risk based Internal Audit of Branches and other units for FY 2025-26:
During FY 2025-26, Audit was completed in 5,760 branches, and rating finalization was completed. The risk assessment of these Branches indicates that 55.10% were classified as Low Risk, 43.29% as Medium Risk, and 1.61% as High Risk, while no Branch was categorized under Extremely High Risk, reflecting an overall stable risk profile.
Concurrent Audit of select Branches and other units:
The Bank appointed 2,099 concurrent auditors during FY 2025-26, covering 2,095 branches/verticals/units. Of these, 1,569 business branches accounted for 54.18% of total deposits and 74.67% of total advances as on 31.03.2025, while 45 Verticals/Sub-Verticals were brought under the Concurrent Audit framework.
The Bank also conducts Revenue Audit of branches to evaluate that if there is any leakage of Income.
Management audit of controlling offices and CO Verticals
During FY 2025-26, the Bank conducted Management Audit (for FY 2024-25) to review managerial effectiveness, governance processes, and internal control systems across its operations through a systematic and disciplined approach. The audit covered 134 Regional Offices, 18 Zonal Offices, 18 Zonal Audit Offices, 33 Central Office Verticals, and 7 other offices, strengthening overall management oversight and operational efficiency.
23.1 Information Security Audit:
During FY 2025-26, the Bank carried out Information Systems (IS) Audits using a combination of its internal audit team and CERT-In empaneled external auditors. The audits covered 285 IT applications/processes, 74 administrative offices, and 3 foreign units. In addition, 34 pre-implementation audits were conducted before system go-live to ensure proper IT controls.
23.2Foreign Branches Audits:
The Bank is having branches at Dubai, Sydney and subsidiary at UK. During FY 2025-26, annual audit of all the three places was completed as per time schedule. The periodic audit was also completed at Dubai and Sydney branches.
23.3Special Audits and Special Reports:
The Bank conducts Special Audits to examine specific issues based on requests from controlling offices, and issues Special Reports to promptly highlight irregularities for management attention and corrective action. During FY 2025-26, 100 Special Audits and 69 Special Reports wereissued to find out irregularities for the attention of senior management.
23.4Key initiatives during FY 2025-26:
The Bank has undertaken Remote Audit as a technology- driven initiative to enhance audit efficiency and coverage. This initiative is expected to reduce cost and effort, improve audit quality, and ensure greater uniformity in the audit process across locations.
The Bank is progressing with the transformation of its Audit & Inspection framework, in line with evolving practices in digital, risk-based, and continuous auditing. Also, it has strengthened data analytics and offsite monitoring capabilities, enabling better identification of risks and timely corrective actions. These initiatives are expected to improve audit effectiveness, reduce turnaround time, and further strengthen governance and overall risk management.
24 Cyber Security
24.1 Cybersecurity Governance Framework and Strategic Oversight
Union Bank of India has established a comprehensive and forward-looking Cybersecurity Governance Framework supported by robust data governance, privacy management, and technology risk oversight practices. The Banks cybersecurity architecture is guided by its Information Security Policy, Cyber & Digital Payment Security Policy, and Data Governance Framework, ensuring secure and resilient digital banking operations.
The Bank continues to align its cybersecurity posture with evolving regulatory and global standards, including the Reserve Bank of Indias Cyber Security Framework (2016), Master Direction on Digital Payment Security Controls (2021), and Master Direction on
Information Technology Governance, Risk, Controls and Assurance Practices (2023). The Bank also adheres to internationally accepted standards such as ISO 27001 (Information Security Management System), ISO 22301 (Business Continuity Management System), ISO 27701 (Privacy Information Management System), ISO 31000 (Enterprise Risk Management), PCI-DSS, and PCI-PIN Security Standards.
Union Bank of India holds ISO 27701:2019 certification for its Privacy Information Management System (PIMS), reinforcing its commitment to the protection of Personally Identifiable Information (PII), data privacy, regulatory compliance, and stakeholder trust.
In recognition of the criticality of banking infrastructure, key systems including CBS, RTGS, NEFT, IMPS Switch, ATM Switch, and UPI Switch have been notified as "Protected Systems" under the Information Technology Act by the Ministry of Electronics and Information Technology (MeitY), Government of India. The Bank fully complies with the Information Technology (Information Security Practices and Procedures for Protected Systems) Rules, 2018.
The Bank has institutionalised cybersecurity leadership at the highest level through the appointment of a Chief Information Security Officer (CISO) at the rank of Chief General Manager. The CISO also functions as the Group CISO for subsidiaries, joint ventures, and associate entities, ensuring enterprise-wide cybersecurity governance and strategic alignment across the ecosystem.
Cybersecurity continues to remain a strategic pillar in the Banks digital transformation journey, enabling secure innovation, operational resilience, and customer trust in an increasingly interconnected financial ecosystem.
24.2Cybersecurity Infrastructure, Innovation and Threat Resilience
Union Bank of India has adopted a multi-layered "Defence in Depth" cybersecurity strategy to safeguard its digital infrastructure, customer assets, and critical banking operations. The Bank has implemented advanced security controls across perimeter security, network security, endpoint protection, application security, identity and access management, threat intelligence, and data security domains.
The Bank follows a "Security by Design" approach in the implementation of digital initiatives and technology platforms, embedding cybersecurity controls into systems, applications, and digital products from the inception stage itself. This approach supports secure digital transformation while ensuring compliance, resilience, and customer confidence.
The Banks Data Centre and Disaster Recovery facilities are certified under ISO 27001 and ISO 22301 standards, while its Enterprise Risk Management framework is aligned with ISO 31000 standards. Card payment systems and ATM switch infrastructure continue to maintain PCI-DSS certification.
The Banks cybersecurity posture continues to remain among the strongest in the industry, reflected in its consistent "Advanced" category rating by BitSight, a globally recognised cybersecurity rating agency.
• Next Generation Security Operations Centre (NGSOC)
• As part of its futuristic cybersecurity vision, the Bank has established a state-of-the-art Next Generation Security Operations Centre (NGSOC) operating on a 24x7 basis with dedicated cybersecurity specialists for continuous monitoring, threat detection, incident response, and cyber threat intelligence. The NGSOC is tightly integrated with critical banking applications and infrastructure layers to proactively identify and mitigate emerging cyber threats. The NGSOC enables real-time security event correlation, advanced threat analytics, proactive monitoring of cyber risks, and rapid response mechanisms to strengthen enterprise-wide cyber resilience. Bank implemented Centralised Threat Intelligence Platform ingesting multiple local and global threat intelligence seamlessly
• Cyber Security Centre of Excellence (CCoE)
The Bank has established a dedicated Cyber Security Centre of Excellence (CCoE) as a strategic cybersecurity capability hub to strengthen cyber resilience, security innovation, proactive threat assessment, and advanced cyber defence engineering across the enterprise. The CCoE plays a pivotal role in enhancing cybersecurity maturity through continuous assessment, automation,
research-driven controls, security analytics, and specialised cyber capability development.
The CCoE hosts and operationalises multiple advanced cybersecurity functions and platforms, including:
• Enterprise Vulnerability Management Centre (EVMC) for Vulnerability Assessment and Penetration Testing (VA/PT), Source Code Security Review, Secure Configuration Assessment, and enterprise- wide vulnerability management activities.
• Continuous Automated Red Teaming (CART) framework for ongoing adversarial simulation and validation of defence effectiveness.
• Breach & Attack Simulation (BAS) platform for continuous testing of security controls against evolving cyberattack scenarios.
• Digital Forensics and Malware Analysis (DFMA) capabilities for forensic readiness, malware investigation, ATM/CRM malware analysis, suspicious email analysis, and cyber incident investigations.
• Periodic Red Teaming exercises through specialised external agencies to simulate sophisticated attack scenarios and assess the resilience of controls, monitoring mechanisms, and response capabilities.
• Cyber drills and simulation-based preparedness exercises for testing organisational readiness, detection capability, response coordination, and cyber incident handling effectiveness.
• Ethical Hacking Lab for continuous identification of vulnerabilities across internet-facing and internal applications and infrastructure.
• Attack Surface Management and Digital Risk Monitoring solutions for identifying exposed assets, leaked credentials, sensitive data exposure, and emerging digital risks.
• Cyber Range Simulation Platform for immersive cybersecurity training and simulation-based preparedness exercises.
24.3Cybersecurity Awareness and Culture Building
Union Bank of India continues to strengthen cybersecurity awareness and digital safety practices among customers, employees, and stakeholders through structured awareness initiatives, continuous engagement, and capability-building programs. As part of its strategic awareness initiatives, the Bank has collaborated with premier institutions including the Centre for Development of Advanced Computing (C-DAC), Hyderabad, and the Cyber Security Centre of Excellence, Department of IT & Electronics, Government of West Bengal, for conducting cybersecurity awareness programs, webinars, and specialised training initiatives. The Bank has also introduced unique cybersecurity mascots ? "U Su^Ksha" and "U ^"Kshak" to promote cyber hygiene and safe digital banking practices in an engaging and relatable manner.
• Customer Cybersecurity Awareness Initiatives
• The Bank undertakes extensive customer awareness campaigns through multiple digital and physical channels, including:
• Secure usage advisories integrated into Internet Banking and Mobile Banking applications.
• Cybersecurity awareness messages printed on passbooks, ATM transaction slips, and credit card statements.
• Regular customer advisories through emails and SMS alerts on emerging cyber frauds and preventive measures.
• Awareness videos, posters, and digital campaigns across social media platforms including LinkedIn, Facebook, Instagram, X, and YouTube.
• Cybersecurity awareness creatives displayed through Network Electronic Display Units (NEDU) across branches.
• Pan-India cybersecurity awareness webinars conducted through zonal offices and customer engagement programs.
• Participation in "Cyber Jaagrookta Diwas" initiatives of the Ministry of Home Affairs, Government of India, through customer outreach campaigns, webinars, and awareness drives.
• Theme based cybersecurity awareness camps were organized for various target groups, including Rural Self Employment Training Institutes (RSETIs), Self Help Groups (SHGs), Business Correspondents (BCs) of the bank, senior citizen customers, as well as school and college students, with the objective of enhancing awareness on safe digital practices and cyber risk prevention.
These initiatives reflect the Banks commitment to building a cyber-aware customer ecosystem and strengthening trust in digital banking channels.
24.4 Employee Cybersecurity Awareness and Capability
Development
• The Bank continues to foster a strong cybersecurity culture among employees through structured learning and continuous engagement initiatives. Key programs include:
• Annual enterprise-wide cybersecurity awareness action plans.
• Cybersecurity town halls and interactive awareness sessions across locations.
• Daily cybersecurity advisories and best-practice communications.
• Phishing simulation exercises for employees to enhance awareness against social engineering attacks.
• Interactive learning activities including cybersecurity quizzes, puzzles, and awareness campaigns.
• Celebration of National Cybersecurity Awareness Month (NCSAM) through month-long expert sessions and webinars.
• Dissemination of cybercrime reporting awareness through the National Cyber Crime Reporting Portal and helpline 1930.
• Periodic publication of cybersecurity newsletters, threat intelligence updates, and emerging risk advisories.
• To further strengthen leadership capabilities, the Bank has also launched the Cybersecurity Executive Development Program (CSEDP), an in- house certification initiative designed to enhance
cybersecurity and technology risk awareness among senior executives and leadership teams.
• The Bank remains committed to continuously strengthening cyber resilience, safeguarding customer trust, and building a secure, future- ready digital banking ecosystem through sustained investments in cybersecurity governance, advanced technologies, and awareness-driven culture building.
25 Analytics Capabilities
Your Bank has successfully implemented a next- generation Data Repository, Analytics & Reporting Platform (Enterprise Data Lake), that consolidates voluminous structured and unstructured data from diverse sources. This modern data repository enhances advanced analytics capabilities, improves data exploration, and optimizes operational costs. Bank is leveraging this innovative infrastructure in areas such as ML-based credit underwriting, analytics-led business generation & customer retention, as well as stress- identification and fraud management.
By enabling real-time data access and delivering consistent, high-quality insights, the platform strengthens both internal and regulatory reporting while supporting accurate analysis and greater business agility. It empowers the Bank to make data-driven decisions, elevate customer experience, enhance compliance, risk management and reinforce its overall market competitiveness.
26 Credit Compliance and Monitoring
During FY 2025-26, the Bank strengthened its Collection Management framework through the following key initiatives:
26.1 BoT Calling Initiative
To ensure timely recovery of dues and further strengthen the collection mechanism, the Bank established a full- fledged Call Centre for reminding borrowers regarding timely payment of EMIs and other dues.
In order to improve outreach and operational efficiency, the Bank implemented BoT Calling in 11 vernacular languages, enabling communication with a larger borrower base within a shorter time frame. This initiative has significantly enhanced customer engagement and contributed to improved collection efficiency.
26.2Implementation of Union Collection Management Solution (UCMS)
The Bank developed and implemented the Union Collection Management Solution (UCMS), an advanced platform designed to enable data-driven and customized collection strategies based on customer behaviour patterns and analytical insights derived from both internal and external data sources.
Historical loan data has been leveraged to develop a scoring/propensity model for assessing the likelihood of repayment by individual borrowers (Propensity-to- Pay Score). The solution utilizes AI/ML-driven predictive analytics incorporating financial indicators, demographic details, payment and transaction behaviour, historical repayment performance, bureau data, customer segmentation, stress indicators, and asset-related information.
Based on these analytical insights, UCMS generates a risk categorization framework that assists the Bank in identifying the most effective communication channel and collection strategy for each borrower segment. The Propensity-to-Pay Score generated by the solution enables the Bank to adopt targeted and efficient recovery strategies, thereby improving collection outcomes and operational effectiveness.
27 Vigilance
The Vigilance Department of the Bank functions under the supervision of Chief Vigilance Officer (CVO), and three Additional Chief Vigilance Officers (ACVO), who act as an extended arm of Central Vigilance Commission. The CVO & ACVOs are assisted by a team of 46 functional vigilance Executives/officers stationed at Central Office and 148 Field Vigilance Officers including APGB, mapped to Regional/Zonal Offices PAN India. The team is managed by 02 DGMs and 05 AGMs at Central Office, along with 03 AGMs stationed on each at Delhi, Mumbai & APGB. Vigilance functionaries, at each level, act as a preventive task force, ensuring sustainable business growth and contributing towards profitability of the Bank. Being a part of Assurance Functions, it is marked as one of the defence pillars of the Bank, promulgating the environment of integrity, and accountability with transparency at all stages. The department has 03 major functional areas- Preventive, Participative and Punitive. Moreover, department aims at proffering systemic improvements for reformation of systems and procedures for strengthening the fundamentals of the organization. By proactively evincing and addressing potential risks, the Vigilance Department helps in mitigating financial, legal and reputational risks associated with corruption and fraud, protecting the interests of the organization and its stakeholders.
To effectuate Participative Vigilance:
1. Vigilance Awareness Day is observed on every Second Thursday of each month to address the on- going frauds, their modus operandi and remedial preventive actions.
2. With the endeavour to exact awareness, an In-House film was directed showcasing the significance of holding integrity and rectitude towards oneself and the organisation, reemphasizing the commitment of the Bank to its core values of transparency and authenticity in its procedures- Vigilance- Our Shared Responsibility.
3. Video song involving Top Executives of the Bank, reiterating the commitment towards upholding values of integrity and promoting culture of venerability, and imbibing vigilance as an individual responsibility was launched during Vigilance Awareness Week, 2025.
4. To create awareness, participative vigilance drive is undertaken at all level by conducting periodic preventive vigilance visits at all units of the organisation. This is also a prime objective of observing Vigilance Awareness Campaign every year.
5. The department has also circulated educative series for capacity building of the officials working at
Branches and controlling offices i.e. weekly series- "Drishti" 52 issues, Monthly series "Satarkata Se Safalta" -12 issues and 4 issues of quarterly series "Union Vigil".
6. A total of 8988 Preventive vigilance visits were Undertaken, covering all the functional units of the Bank, to create awareness, especially pertaining to fraud prone areas and advise Functional Heads to ensure appropriate systems and procedures are put in place.
In the endeavour to leverage IT platforms to strengthen the preventive measures various initiatives were taken in this financial year to contribute towards sustainability principle of the Bank. End-to-end digitization of disciplinary process was launched as "Project Vishwas"- An online user-friendly platform for HR, ER, and Vigilance officers, facilitating online submission and collection of documents, efficient case review, and prompt action- taking. It is designed with integration of existing Human Resource Management Systems and Core Banking Database to ensure seamless data flow and real-time monitoring of disciplinary cases.
A concept of Digital Vigilance Dashboard was devised which comprises of details of the different sections of Vigilance such as current status of the cases, Complaints, and disposal, analysis of cases etc. It is presented to Top Management on fortnightly basis.
As per advisory of Central Vigilance Commission, Preventive Vigilance campaign was observed/ undertaken, as a precursor to Vigilance Awareness Week, 2025, from 18th August 2025 to 17th November 2025 and Vigilance Awareness Week 2025 envisaging the theme "Vigilance: Our Shared Responsibility / was observed in a befitting manner from 27th October to 2nd November 2025 in, across all branches/offices PAN-India.
As a part of the celebrations, various Vigilance Awareness Programmes were conducted within the organization and outreach activities on PAN India basis, to spread awareness among the general public and youth of India on eradicating corruption and remedial measures available to them. A Total of 14947 events were conducted under Vigilance Awareness Week 2025. 74,000+ staff members and 2,77,620 citizens has participated at different levels in the programs conducted during VAW 2025. Compendium comprising lessons from fraud and educative series on banks policies were released during the campaign period.
28 Operation
28.1 Digital Customer Service and Banking Initiatives
During FY 2025-26, the Bank continued to strengthen its customer service architecture through expansion of digital, assisted and inclusive banking channels. The Bank remained focused on improving customer accessibility, enhancing service efficiency and enabling consistent customer experience across multiple service touchpoints.
The Bank has progressively expanded its digital and assisted servicing ecosystem through WhatsApp banking, Digital Contact Centre services, grievance redressal mechanisms, self-service journeys and accessibility-driven initiatives. These initiatives are aligned with the Banks broader objective of improving customer convenience, reducing dependency on branch visits and strengthening technology-enabled customer engagement.
• UVConn 3.0 - WhatsApp Banking
UVConn 3.0 is the Banks 24x7 WhatsApp- based digital banking platform available on mobile number 9666606060. The platform leverages WhatsApp as a conversational banking channel enabling customers to access banking information, account-related services and assisted customer support in a simple and convenient manner.
The platform is currently available in 7 languages ? English, Hindi, Kannada, Telugu, Tamil, Bangla and Marathi ? thereby supporting wider customer accessibility across regions. UVConn presently offers more than 74 non- financial services/features covering account information, service requests, loan and deposit product details, statements, customer care assistance and customer feedback services.
During FY 2025-26, several new services/ features were added on the platform including
Education Loan Interest Certificate, Transaction Dispute, Deposit Details, Addition of Secondary Accounts in Debit Card, Account and Deposit Products, Retail Loan Products, MSME Loan Products, Agri Business Products, Gold Loan Products, Chat with UVA, PPF statement, SSA Statement, Pension Slip and Branch Feedback.
Additional customer experience enhancements such as display of customer care information within service descriptions and integrated feedback mechanism were also introduced.
UVConn has further been enabled for NRI customers across 19 countries. Newly onboarded customers are also provided with a welcome communication highlighting the services available through the platform. As on date, over 75.15 la kh+ customers have been onboarded on UVConn and more than 476 lakh+ customer enquiries have been processed through the platform, reflecting increasing adoption of conversational digital banking channels.
• Digital Contact Centre
The Banks Digital Contact Centre (DCC) has evolved into a large-scale omnichannel customer service and engagement platform supporting inbound and outbound voice, chat, video banking, email and bot-assisted servicing. Operating on a 24x7 basis through centres at Noida, Mumbai and Hyderabad, the DCC presently supports customer outreach of approximately 30 lakh interactions per month, including around 8-10 lakh agent-assisted interactions.
The DCC currently supports customer servicing in 22 languages. In addition to English and Hindi, services are also available in Assamese, Bengali, Bhojpuri, Gujarati, Kannada, Kashmiri, Khasi, Konkani, Maithili, Malayalam, Marathi, Nepali, Oriya, Punjabi, Sindhi, Tamil, Telugu, Urdu, Santhali and Tulu. The Banks chatbot platform has also been enabled across all 22 languages to strengthen multilingual digital servicing and customer accessibility.
The Bank has progressively transformed the earlier call centre model into an integrated Digital Contact Centre ecosystem with enhanced self-service, assisted servicing and Al-enabled capabilities. Presently, the DCC ecosystem supports multiple Al-enabled capabilities including conversational bot, chatbot, speech analytics, voice biometric, automated quality management, workforce management and agent assist solutions, along with 35+ API- enabled self-service journeys through IVR and digital channels.
• The Digital Contact Centre has also strengthened customer experience and service continuity through initiatives such as 100% abandoned call-back mechanism, multilingual servicing, customer segmentation, assisted digital journeys and centralised handling of customer emails and service requests. The platform additionally supports fraud alert verification, customer protection support, collections outreach and proactive customer engagement initiatives.
28.2New Projects Implemented
The Bank has implemented several customer-centric initiatives during the year aimed at simplifying banking processes, improving accessibility and enhancing customer convenience across service channels.
Pre-filled service request forms and TD/RD account opening forms has been implemented, enabling generation of customer-ready forms based on Customer ID or account number. This initiative has simplified routine servicing requirements such as mobile number updation, address updation and identity detail modification while reducing manual intervention and improving customer convenience.
The Bank has introduced Sign Language Interpretation support through the Digital Contact Centre to improve accessibility and inclusive banking support for customers with hearing and speech impairments. The service is enabled through secured video-assisted servicing channels and reflects the Banks commitment towards technology-enabled inclusive banking
28.3GRIEVANCE REDRESSAL MECHANISM
The Bank has strengthened its Grievance Redressal Mechanism to ensure structured, timely and effective resolution of customer complaints and grievances. Roles and responsibilities at various levels of the grievance redressal framework have been clearly defined and standard operating procedures have been established to support faster complaint resolution.
The revised Grievance Redressal Policy provides a comprehensive framework for handling customer complaints through a structured escalation matrix and defined turnaround timelines depending upon the nature of complaints. The objective is to minimise customer grievances and ensure prompt and fair resolution.
Customer complaints can presently be lodged through multiple channels including corporate website, IVR, call Centre, mobile banking, WhatsApp banking and email. Customers are provided with a complaint reference number upon registration of complaints. Cyber fraud-related complaints are handled on a 24x7 basis. QR-code enabled complaint registration and customer feedback mechanisms have also been introduced.
During FY 2025-26, the grievance redressal performance of the Bank was as under:
| No. of Complaints outstanding as of 01st April 2025. | 11,643 |
| No. of Complaints received during the year. | 7,60,545 |
| No. of Complaints resolved during the year. | 7,55,118 |
| No. of Complaints outstanding as of 31st March 2026. | 17,070 |
28.4Disclosure of Award from Banking Ombudsman
One Award of Rs. 3,97,055.71 (Rupees Three Lakh Ninety-Seven Thousand Fifty-Five and Seventy -One Paise) is issued against the Bank under Clause 15(1)(b) of Reserve Bank - Integrated Ombudsman Scheme, 2021.
28.5National Processing Centre for Back Office Operations
Technology driven customer framework that streamlines and secures customer onboarding process and back-office operations for the Bank.
28.5.1 Key NPC back-office functions:
• Centralized and Standardized Customer Onboarding
The bank has implemented a centralized processing system with uniform Standard Operating Procedures (SOPs) for customer onboarding processes, reducing manual intervention and operational errors.
This standardization simplifies branch processes and ensures consistency across all customer onboarding activities.
De-duplication checks and authentication controls further strengthen the integrity of customer data, reducing the need for manual verification. Enhanced controls and automation significantly curtail fraud risk and operational errors, supporting more secure and efficient back-office operations
• Digital Self-Service and V-CIP
Customers can initiate onboarding digitally, complete video KYC remotely and self-register for Internet Banking, Mobile Banking and WhatsApp Banking reducing the volume of in- person branch visits and paperwork.
29 Strategy Vertical
During FY 2025-26, the Strategy Vertical has been strengthened and repositioned as the unified "Corporate Strategy and Business Excellence" Vertical to serve as the Banks central engine for growth and transformation.
By bringing together strategy formulation, analytics, economic research, CR & MIS, EASE reforms, joint venture & subsidiary and project management under a unified and single reporting structure, the Bank now has a powerful institutional platform to convert ideas into action, data into decisions, and policies into measurable outcomes.
This integrated vertical is enabling sharper prioritization of business initiatives, faster rollout of digital journeys, tighter monitoring of mission-critical projects, improved regulatory preparedness, and seamless coordination across verticals and the field. It embeds a bottom-up, employee-centric and customer-focused approach to change for ensuring that reforms are timely, and responsive to operational realities.
Revamped Corporate Strategy and Business Excellence Vertical, has taken several initiatives such as Project Muskaan, Union Innovation League etc. as structured Bottom-up engagement approach to strengthen field support, streamline processes, enhance digital oversight, deepen compliance & security posture and accelerate execution across the Bank. Further, Business & Compliance Campaigns covering all Business Units have been launched focusing on Business Development and Compliance parameters which has resulted in sustained business growth and improvement in overall compliance levels.
30 Eco System Banking
The Bank has initiated the Ecosystem Banking Vertical as a forward-looking strategic step to strengthen its institutional business and build a more stable and sustainable deposit franchise.
In todays environment, institutions do not operate in isolation. Each organisation is part of a larger network comprising employees, vendors, contractors, service providers and beneficiaries. These interconnected relationships generate multiple financial flows, ranging from salaries and operational balances to payments, collections and investment activities.
The Ecosystem Banking Vertical is designed to capture this broader opportunity by shifting the Banks approach from individual account relationships to a more comprehensive ecosystem-based engagement.
Under this approach, each institutional relationship is treated as an anchor, around which the Bank engages with the entire network. This enables the Bank to deepen relationships, expand engagement across multiple participants and create long-term, value-driven banking partnerships.
The initiative reflects a strategic move towards building a relationship-led and flow-based banking model, aligned with evolving customer expectations and industry trends.
30.1What the Bank is Envisaging
The Bank envisages the Ecosystem Banking Vertical as a key driver of sustainable growth, particularly in strengthening its CASA base and enhancing overall business quality.
The focus is on building deeper engagement with institutions across segments such as Government, public sector entities, corporates, educational institutions, healthcare organisations and emerging business clusters.
Through this initiative, the Bank aims to:
? Build long-term relationships with institutional clients by offering integrated financial solutions
? Expand engagement beyond core accounts to include employees, vendors and affiliated participants
V Increase the share of operational and transaction- linked balances
V Strengthen the Banks presence in high-quality and recurring financial flows
The emphasis is on creating a banking model where growth is driven by ongoing financial activity within institutional ecosystems, rather than episodic or short- term mobilisation.
Over time, this approach is expected to improve the quality of deposits, enhance customer engagement and support a more resilient business profile.
30.2Operating Framework
To implement this initiative in a structured and scalable manner, the Bank has established a dedicated operating framework.
The Ecosystem Banking Vertical functions through a multi-layered structure comprising:
V A central team responsible for strategy, governance and overall coordination
V Field-level 9 Ecosystem Hubs that align and guide execution across geographies
V Dedicated 118 Ecosystem Business Centres that drive engagement with institutions and their ecosystems
This framework ensures that ecosystem opportunities are identified, pursued and developed in a coordinated manner across the Bank.
In addition, the initiative integrates key capabilities such as institutional relationship management, transaction banking and wealth solutions, enabling a comprehensive approach to client engagement.
30.3The operating model is designed to:
V Ensure consistent execution across regions
V Leverage the Banks existing network and customer base
V Facilitate better coordination across business functions
V Support long-term relationship development
This structured approach allows the Bank to combine strategic direction with strong execution capabilities at the field level.
30.4How it will add value to the Banks Shareholders
The Ecosystem Banking Vertical is expected to contribute meaningfully to the Banks long-term performance and value creation.
a. Strengthening of CASA Franchise: By anchoring deposits to operational and transaction flows, the Bank will be able to build a more stable and granular CASA base. This reduces volatility and supports a lower cost of funds.
b. Sustainable Growth Model: The initiative focuses on capturing recurring financial flows such as salaries, payments and collections. This creates a steady and predictable growth trajectory, enhancing business stability.
c. Enhanced Fee Income: Increased integration with institutional transactions is expected to drive growth in fee-based income through payment and collection services and related offerings.
d. Improved Customer Depth: Engagement across the broader ecosystem enables the Bank to deepen relationships and increase its share of business within each institutional client.
e. Long-Term Relationship Stability: A more integrated engagement model strengthens customer stickiness and reduces dependence on short-term or transactional relationships.
f. Platform for Future Expansion: The Ecosystem Banking framework provides a scalable platform for future growth, enabling the Bank to expand into new segments and leverage emerging opportunities in institutional and transaction banking.
30.5Way Forward
The Ecosystem Banking Vertical represents an important step in the Banks ongoing transformation journey.
By aligning institutional relationships with broader financial ecosystems, the Bank is building a model that is not only growth-oriented but also sustainable and resilient.
This initiative reinforces the Banks commitment to strengthening its core business fundamentals, enhancing customer engagement and delivering consistent long- term value to its shareholders.
31 Central Reconciliation.
Reconciliation department has put in place a robust reconciliation process for transactions emanated through different digital channels. Reconciliation of all the digital transactions are being done in T+1 days/as stipulated by NPCI.
During FY 2025-26, the Recon Vertical had reconciled
2,030.04 Crore digital transactions. On an average Bank had handled 5.56 crore transactions per day.
The Vertical had also complied with Statutory/ Regulatory guidelines and Network directives related to reconciliation and refund of failed transactions. All the disputes raised by the customers on digital transactions were attended promptly and disposed/resolved within the timelines stipulated by the NPCI.
The Reconciliation Department is in preparedness to implement Cycle wise reconciliation of the digital transactions. This will enable the Bank to reverse the failed transactions proactively within 4 hours on the same day. This transition is a corner stone of Banks commitment to operational excellence and "customer- first" strategy.
32 Digital Business Vertical.
"During the year, the Bank established the Digital Business Vertical (DBV) as a dedicated setup to drive business growth through digital channels. The formation of DBV marks an important strategic step towards building scalable digital distribution capabilities, improving customer experience and strengthening the Banks presence across emerging digital ecosystems.
DBV has been envisaged as a focused business vertical responsible for enabling and accelerating digital business mobilisation through non-branch channels, partnerships and technology-driven platforms. The Vertical works in close coordination with business, operations, technology and assurance functions to develop seamless and efficient digital journeys for customers.
The key focus areas of DBV include digital lending, digital deposits, partnerships with fintechs and digital platforms, process digitisation and analytics-based monitoring of digital business. The Vertical also aims to ensure appropriate governance and control mechanisms in digital operations.
With increasing customer preference for digital banking services, the establishment of DBV positions the Bank to respond more effectively to evolving market dynamics and customer expectations, while creating a strong foundation for future digital growth and innovation."
33 Support Services Department
The Support Services Department (SSD) sustained its focus on enabling the smooth and efficient functioning of the Bank by delivering high-quality, environment- friendly infrastructure. The Department emphasized optimal space utilization and climate-responsive designs, ensuring alignment with Environmental, Social, and Governance (ESG) principles.
SSD continues to support the Banks growth by providing adequate office and residential facilities for staff that meet both current operational needs and future expansion requirements. The Department remains committed to the timely completion of projects, advancement of planned initiatives, and implementation of sustainability measures aimed at reducing carbon emissions and enhancing energy efficiency while optimising cost.
Under infrastructure development, a strong emphasis has been placed on green building practices. Construction of two new office buildings was initiated in the previous FY, while four additional office buildings are at various stages of completion. All projects are being developed with a focus on green building certification, energy-efficient systems and sustainable construction practices.
Going forward, the Bank aims to accelerate the adoption of renewable energy solutions and eco-friendly technologies across all projects. Continued focus will be placed on completing ongoing projects within stipulated timelines while ensuring effective execution of planned initiatives.
34 Outlook
34.1 During FY 2025-26, Indian economy recorded robust growth amidst external headwinds. Economic activity gained momentum and the provisional estimates (SAE) of national income released by the NSO placed Indias real GDP growth at 7.6% y-o-y in
2025-26 on the back of robust growth in private final consumption expenditure. On the supply side, real gross value added (GVA) expanded by 7.7%, y-o-y, driven by manufacturing and services sectors. The headline consumer price index (CPI) inflation have averaged 2.1% during 2025-26, lower than 4.6% recorded for 2024-25. Economic activity remained strong supported by revival in consumption as well as governments capex push. Pick up in private consumption, upturn in agricultural activity, continuing resilience of the services sector, high capacity utilisation, healthy balance sheets of banks and corporates, and governments continued thrust on capital expenditure augur well for the growth outlook. Moreover, several measures announced in the Union Budget 2026-27 are also growth supportive.
34.2The Union Budget 2026-27 has proposed a six- point plan which focuses on scaling up domestic manufacturing in several strategic and frontier sectors, rejuvenating legacy industrial sectors, creating champion MSMEs, boosting infrastructure, ensuring long-term energy security and stability, and developing city economic regions. This, coupled with further progress on trade deals with major economies, bodes well for Indias overall growth outlook. Global headwinds stemming from rising geopolitical tensions, elevated commodity prices and supply-chain disruptions, however, pose downside risks to the growth outlook.
Bank credit growth is expected to remain double digits in FY 2026-27. With the significant turnaround seen in capital, provision coverage and asset quality ratios apart from profitability levels/ metrics over the last 10-15 years, the banking sector is seen to be well equipped to support the required credit creation to fund Indias growth trajectory. Going forward, the RBI has reiterated that it will remain vigilant, agile, and nimble in policy actions so as to support the economic growth while mitigating the impact of global spill overs on domestic financial markets.
35 Opportunities
1 Banking sector well positioned to fund long term India growth story
With the significant turnaround seen in capital, provision coverage and asset quality ratios apart from profitability levels/ metrics over the last 10- 15 years, the banking sector is well equipped to support the required credit creation to fund the growth trajectory.
Governments vision of "Viksit Bharat" by 2047 places banking at the centre of Indias growth financing framework. This is reflected in the establishment of a High-Level Committee on banking in Union Budget 2026-27. Trade agreements, production- linked incentive schemes, infrastructure push, and increased formalisation of economic activity are creating sustained demand for banking services across the value chain?ranging from working capital and project finance to trade finance, forex services, transaction banking, and retail financial products.
2. Credit momentum has picked up to high double- digit growth in FY26 and momentum may sustain in FY27
Banking system-level credit growth has accelerated to ~16% during FY26 from ~11% in FY25, led by both demand and policy initiatives. The rise in credit demand despite lagging broad based private capex recovery is showing up in the mix of loans, with greater pickup in share of working capital loans, demand loans, and other short-tenor facilities even as gradual decline is underway in the share of term loans and large corporate exposures. Going forward, in FY27, geopolitical uncertainty is likely to adversely impact growth amid spike in commodity prices, slowdown in capital flows, disruption in capex sentiment, yet potential spike in nominal GDP growth from -8.5% in FY26 to projected -12-14% in FY27 is likely to sustain credit growth around 13- 16% range.
3. Sectoral credit opportunities are emerging with potential to be reaped
Opportunity lies in sectors such as electronics, semiconductors, renewables, electric vehicles, industrial machinery, medical devices, battery cells, food processing, data centres and logistics which are opening new lending and fee income opportunities, particularly in MSME-intensive clusters. This will create sustained demand for export credit, MSME financing, capex loans, and foreign exchange services. The opportunity lies in pre-shipment credit, bill discounting, supply chain financing, FX hedging solutions etc., thus, transitioning from traditional bank to a capex financing and project evaluation institution in the long run.
36 Threats
1. Geopolitics posing pressures on banking sector dynamics
The global environment remains uncertain with consistent disruptions due to global geopolitical events like Trump tariff related issues in 2025 followed by start of West Asian conflict from 2026. We compliment the policymakers, both the Government and the RBI, for undertaking appropriate steps in order to cushion the impact of geopolitical tensions on the economy especially the banking sector, yet the need for a cautious approach in undertaking business decisions is pertinent at the current juncture. The channels of impact on the banking sector have been witnessed via spike in market rates adversely affecting Treasury incomes, potential rise in stress in affected sectors especially MSMEs though policy steps are helping cushion impact among others.
2. AI/Digital advancement also poses challenges that need to be addressed
The banking sector itself is undergoing rapid transformation. Digital channels have become central to customer acquisition, servicing and engagement. Customer expectations have evolved sharply, with increasing emphasis on speed, convenience, transparency and seamless omnichannel experiences. Digitisation is also weighing on deposit growth via promoting "Just in Time" approach in government deposits and use of digital payment /wealth management apps also reducing "float" time (money sitting idle) in CASA accounts.
Additionally, the shift from generative AI (writing content) to agentic AI (AI agents acting, such as buying/selling) requires new governance structures to manage accountability, liability, and operational risk. Also, there is need for specialized skills in IT, risk management, and data analytics to Mid-level staff. This presents a strategic staffing challenge in near midterm.
For Public sector banks, this transformation presents a dual challenge. On one hand, there is a need to compete effectively on technology, customer experience and product innovation apart from "heightened cyber risks" along with AI adoption related challenges. On the other, there is a responsibility to support Government programme, priority sectors and financial inclusion objectives.
This requires a strategy that is differentiated, focused and execution-driven, rather than one that attempts uniform expansion across all areas.
3. Structural rise in cost of deposit remains key underlying theme
In FY26, while credit growth spiked to 16.1%, deposit growth was lagging at 13.5%, with banks forced to fund Credit-deposit growth wedge is indicative of sustained fight for deposits amongst banks, including increased competition from alternative investment avenues such as mutual funds, equities, and digital financial products. Consequently, low cost CASA deposits have come under pressure for the overall banking system while reliance on high-cost bulk deposit has increased. This has implications for funding costs and hence margins from a medium term perspective as well.
| For and on behalf of the Board of Directors | |
| Place: Mumbai | (Asheesh Pandey) |
| Date:17/06/2026 | Managing Director & CEO |
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