The offer comprises a base issue of Rs 500 crore with a greenshoe option to retain oversubscription up to Rs 1,500 crore, according to the placement memorandum of the bank.
Last week, Union Bank of India raised Rs 2,000 crore via AT1 bonds at an 8.70% coupon, and the issue has seen full subscription. All AT1 bonds were issued based on regulations amended by Sebi earlier this year.
Last week, Union Bank of India raised Rs 2,000 crore via AT1 bonds at an 8.70% coupon, and the issue has seen full subscription. All AT1 bonds were issued based on regulations amended by Sebi earlier this year.
Bank of Baroda, the country’s second-largest state-owned lender, is planning to raise Rs 2,000 crore through the issuance of Basel-III compliant Additional Tier-I (AT1) bonds on Wednesday.
A detailed architecture and sequencing of reform has been proposed in this paper, the purpose of which is to undertake stakeholder consultations. Based on the comments received, the paper will be finalised and shared as a policy recommendation from Niti Aayog.Niti Aayog suggests setting up of full-stack ‘digital banks’“Time is not the essence for transfer of SRs. In the event of non-realisation of amount out of SRs, the bank is not liable to refund anything in part or full,” SBI said in the notice.Security receipts for past NPAs appear as lenders seek to avoid provisioning
Funds raised will be utilised for regular business activities and are not meant for financing any particular project. “The bank undertakes that proceeds of the issue shall not be used for any purpose which may be in contravention of the regulations/ guidelines,” the bank said in a notice.
AT1 bonds are types of perpetual debt instruments that banks use to augment their core equity base and, thus, comply with Basel-III norms. The coupon on the AT1 bonds will be set during the bidding on Wednesday on the electronic bidding platform of the National Stock Exchange.
“We expect better coupons on our AT1 bonds compared to other banks which recently raised funds through these securities,” bank officials said.
Market participants expect rates between 7.95% and 8.05% on Bank of Baroda’s bonds. The deemed date of allotment and pay-in date on the bonds is November 26, while the minimum bid lot size is Rs 1 crore with a bid value step size of Rs 1 crore.
The bonds have been rated AA+ with a “stable” outlook by Crisil and Icra on November 17 and November 12, respectively. The bank has appointed IDBI Trusteeship Services and KFin Technologies as debenture trustee and registrar to the issue, respectively. The AT1 bonds have a call option after five years.
Last week, Union Bank of India raised Rs 2,000 crore via AT1 bonds at an 8.70% coupon, and the issue has seen full subscription. All AT1 bonds were issued based on regulations amended by Sebi earlier this year.
As per amended regulations, the residual maturity of the AT1 bonds is 10 years till March 31, 2022, and will be increased to 20 and 30 years over the subsequent six months. From April 2023, the maturity of these bonds will become 100 years from the maturity date.
Source: Financial Express
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