Private sector lender City Union Bank has unveiled a dual capital reward for its equity holders. The bank decided to issue one free bonus share for every three existing shares held by investors. Complementing the stock allotment, the board also recommended a cash dividend of ₹2 per share for the financial year 2025-26, delivering substantial value to retail and institutional shareholders alike.
June 12 Set as Record Date for Bonus Allotment
The bank management fixed June 12, 2026, as the official record date to establish investor eligibility for the bonus shares. Consequently, market participants must hold the bank shares in their demat accounts by this designated cutoff date to receive the entitlement. Eligible shareholders will receive one complimentary share credited for every block of three shares currently in their possession without incurring any out-of-pocket cost.
Bonus Distribution Arrives After an Eight-Year Gap
This capital restructuring marks a major event for the lender, arriving after a gap of 8 years without bonus issuances. The bank had previously distributed bonus units back in 2017 and 2018, though that historic distribution occurred at a narrower ratio of 1 bonus share for every 10 shares held. The current 3:1 ratio represents a significantly more generous allocation for long-term investors. On the BSE trading floor, shares of City Union Bank recently hovered at ₹244.70, elevating the institution's overall market capitalization past the ₹18,100 crore milestone. Over the trailing twelve months, the counter registered a price appreciation of around 23%. Over a three-year horizon, the stock delivered a 95% return, effectively doubling the invested principal for early buyers.
Dividend Payout of ₹2 Awaits Shareholder Consent
Alongside the equity distribution, the bank will disburse a cash dividend of ₹2 per equity share for fiscal year 2025-26. The explicit record date for this dividend entitlement remains to be notified separately. The dividend funds will be credited directly to the registered bank accounts of qualifying shareholders following formal ratification at the upcoming Annual General Meeting (AGM).
Net Profit Climbs 25% to ₹360 Crore in Fourth Quarter
The corporate rewards are anchored by robust operational metrics reported during the fourth quarter ending March 2026. During the January-March 2026 quarter, City Union Bank logged a net profit growth of 25% year-on-year, touching ₹360 crore compared with ₹288 crore earned during the corresponding period of the previous fiscal year. Core profitability showed equivalent resilience as net interest income (NII) surged 31% to touch ₹786 crore.
Brokerages Maintain Buying Recommendation With ₹350 Target
Encouraged by solid operating metrics and clean margins, leading equities research firms issued positive outlooks on the counter. Brokerage house ICICI Securities advised clients to accumulate City Union Bank shares, establishing a price target of ₹325. Meanwhile, Emkay Global expressed even stronger conviction regarding the lender's growth trajectory, projecting an upside target of ₹350 per share.
