Union Bank shares slide 16% in 6 days after Q4 FY26

What happened to Union Bank shares

Shares of Union Bank of India extended their losing streak for the sixth consecutive session on Thursday, falling 2.78% to a low of ₹162.70. At that level, the stock was down 16.13% over six trading sessions, according to the data provided. The slide followed a combination of bank-specific concerns and a broader risk-off move across banking names. Market attention was split between post-results scrutiny of the lender’s Q4 FY26 numbers and fresh headlines around deposit reporting at some banks.

The immediate trigger cited was a media report that referred to “variations in deposits” at certain private and public sector banks, including Union Bank. That report added to an already cautious tone after the bank’s March-quarter earnings release, which was followed by sharp moves in the stock in subsequent sessions.

Bank’s clarification on the media report

Union Bank issued a clarification to the stock exchanges, challenging the credibility of the referenced report. The lender said the news item appeared to be based on a letter “the authenticity and credibility of which remain unverified” and added that the report contained “certain factual inaccuracies.”

The bank also stressed that its financial statements are subject to “rigorous audit processes,” and that auditors have issued “unmodified audit reports,” affirming the statements present a “true and fair view” under applicable standards. In the same clarification, the PSU lender said it remains focused on strengthening its liability franchise, especially CASA (current account savings account) deposits, through initiatives already outlined in its investor presentation.

Deposit-trend commentary and the timeline cited

Addressing the deposit discussion more directly, Union Bank said its efforts have supported “consistent growth in deposit base on an average basis,” indicating underlying franchise stability. It added that average total deposits and average CASA for the period 01.04.2026 to 28.04.2026 (unaudited) were “much above” the average figures for Q4 of FY 2025-26.

However, the bank did not disclose the specific deposit numbers in the text provided. It also said that movements in deposits immediately after the financial year-end are “in the normal course of business” for the banking industry. This clarification became a key reference point as investors assessed whether the deposit headline risk could have any broader implications.

Q4 FY26 results: profit up, core income softer

Post-results commentary in the provided text highlighted a gap between headline profit growth and pressure points in core earnings. Union Bank reported a 6.6% year-on-year rise in standalone net profit to ₹5,316 crore for Q4 FY26, compared with ₹4,985 crore a year earlier. At the same time, net interest income (NII) declined 1.14% year-on-year to ₹9,406 crore, while one wire excerpt cited about a 1% sequential rise.

The text also flagged that “total income” was reported at ₹31,851 crore in a wire excerpt, while another results summary presented total income as ₹32,674.53 crore (converted from ₹32,67,453 lakh). The article text did not reconcile these two figures, indicating the numbers were drawn from different summaries included in the same compilation.

Provisions and slippages: the overhang investors tracked

A major concern highlighted was provisioning. One report said provisions “nearly tripled” sequentially from ₹322 crore to ₹1,055 crore. Another wire report excerpt cited provisions rising nearly 80% sequentially to ₹423 crore. While the text did not reconcile the difference, both references pointed to the same market interpretation: higher provisioning can compress near-term profitability and indicate elevated risk costs.

On asset quality indicators, fresh slippages for the quarter were cited at ₹2,023 crore, lower than ₹2,483 crore a year ago, but up almost 22% sequentially as per the text. Credit cost was cited at 0.16%, up from 0.09% in the previous quarter. The combination of higher sequential slippages, rising credit costs, and a jump in provisions formed the core of the negative reaction described.

Other income and recoveries: what supported earnings

Other income was reported up over 19% to ₹5,412 crore. The wire excerpt noted a major part of this was driven by recoveries from written-off loans. It specifically mentioned a ₹658 crore recovery from the Sterling Biotech account in the March quarter, which contributed to other income.

This detail mattered because it helped explain why headline profit rose even as core income metrics faced pressure. The market, as described, focused more on sustainability of earnings and the trajectory of credit costs than on one-off or recovery-led support.

Broader market context: Bank Nifty fall and PSU bank volatility

The broader banking tape was also weak in the period referenced. The Nifty Bank index slumped over 3% to an 11-month low, with selling seen in major lenders including State Bank of India and HDFC Bank. The text cited a weaker rupee, persistent FII outflows, and geopolitical tensions as sentiment drags, with analysts warning that volatility and downside risks may persist.

Separately, the text also noted that banking stocks plunged on a Monday session when Maharashtra’s farm loan waiver announcement triggered widespread selling, particularly impacting state-owned banks. In another example of the risk-off environment, SBI shares were said to have plunged 5.60%, erasing nearly ₹62,352 crore in market value, with valuation dipping below ₹10 lakh crore.

Dividend and brokerage view mentioned

Union Bank’s board recommended a dividend of ₹5 per equity share of face value ₹10 for FY26, subject to shareholder approval at the upcoming annual general meeting, with the record date awaited. On the Street view included, Motilal Oswal maintained a ‘Neutral’ rating with a target price of ₹180 per share, which the text described as implying limited upside versus a referenced close of ₹179.71.

Key numbers at a glance

Stock performance snapshot cited

The text included short-horizon performance figures showing: 1 day -2.1%, 1 week -8.85%, and 1 month -0.24%. It also referenced a separate weekly figure of -12.81% in another snippet, indicating different snapshots within the compiled material. Separately, a “share price as on 30th April 2026” was cited as ₹164.13.

Why the episode matters for investors

The sequence underlined how quickly sentiment can shift for PSU bank stocks when multiple risks converge: post-results scrutiny, provisioning and credit-cost signals, and headline-driven concerns around deposits. Union Bank’s clarification attempted to ring-fence the deposit narrative by questioning the authenticity of the underlying letter and reiterating audit rigor.

From a markets perspective, the episode also played out during a period of heightened volatility in banking stocks, where macro factors and policy headlines were already influencing risk appetite. For Union Bank specifically, the debate in the provided text centered on the sustainability of earnings and the direction of core income, provisions, and slippages rather than the reported profit growth alone.

Conclusion

Union Bank’s shares stayed under pressure as investors digested Q4 FY26 numbers and a disputed report on deposit variations. The bank’s exchange filing reiterated audit strength and said early FY27 average deposits and CASA were above Q4 FY26 averages, while noting year-end movements are normal for the industry. The next clear checkpoints referenced in the text are shareholder approval for the FY26 dividend and any subsequent management commentary that addresses core income trends, provisioning, and credit costs.