Union Bank of India negatively surprised us on both earnings and asset quality fronts in 3Q, primarily due to higher slippages as the bank recognised impairment as well as the ensuing provisioning impact of the asset reclassification in accordance with ongoing RBI's evaluation. Slippage came in high at Rs34.1bn (annualized ratio of 5.5%) v/s Rs19.3bn (3.1%) in 2QFY16 and Rs17.4bn (2.9%) in 3QFY15. As a result, the bank reported a provision of Rs12.4bn, an increase of 45.3% yoy and 186.2% qoq. GNPA increased 93bps qoq to 7.1% and NNPA increased by 68bps qoq to 4.1%. Consequently, PCR decreased to 44.2% v/s 46.4% in 2QFY16 and 43.5% in 3QFY15....