New Delhi, July 10 -- Union Bank of India's shares are down about 3% since its soft June quarter (Q1FY26) business update. The bank's domestic deposit growth came in at a mere 3.6% year-on-year, and advance growth was 6.7%. The deposit growth rate being almost half of the advance growth rate should not be a big concern in the near future, as Union Bank's loan-to-deposit ratio is moderate at 73% based on FY25.

It allows the bank to grow its advances faster than deposits, thereby showing higher profit growth in the short term. However, revival in deposit growth is crucial to sustain growth in the long term, as deposits for a bank are like raw material for a manufacturing company.

The bank's growth rate both in domestic deposits and advanc...