The Fall of United Western Bank
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(Case Code: FINC040) click on the button below, and select the case from the list of available cases:
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Please note:
This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Case Details: |
Price: |
| Case Code |
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FINC040 |
For delivery in electronic format: Rs. 300;
For delivery through courier (within India): Rs. 300 + Shipping & Handling Charges extraThemes
Asset-Liability Management, Bank Failures |
| Case Length |
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15 Pages |
| Period |
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1996-2006 |
| Organization |
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United Western
Bank. |
| Pub Date |
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2006 |
| Teaching Note |
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Not Available |
| Countries
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India |
| Industry |
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Banking |
Abstract:
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The case describes the growth and collapse of United Western Bank Limited (UWBL),
a private sector commercial bank in India. Since the late 1990s, UWBL was facing
several problems including asset-liability mismanagement, inefficient management
of bank's assets, irregular transactions with some of its major shareholders
like Makharia Group, conflicts between the bank's major shareholders regarding
the ownership of the bank and poor governance. These problems collectively
resulted in the collapse of UWBL. In order to protect the interests of the
creditors of UWBL, the Government of India (GoI) announced the merger of the
bank with IDBI Bank. The case further details the terms of the merger and ends
with a brief analysis of the future prospects of the merged entity.
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Issues:
» Analyze the reasons that led to the fall of United Western Bank
» Discuss the importance of proper asset-liability management in a bank
» Examine the role of RBI as a banking industry regulating authority and
debating on the justifiability of its actions in the UWBL fiasco
» Appreciate the importance of efficient and transparent management
Contents:
Keywords:
United Western Bank, Asset-liability Management, Bank
Failures , Capital Adequacy Ratio, Non-performing Assets, Makharia Group of
companies, Capital Adequacy Norms, Moratorium Order, Capital to Risk Weighted
AssetS, Liquidity Management, Banking Regulation Act, Bank Restructuring, Asset
Quality, UWBL-IDBI Bank Merger
The Moratorium
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