Canara Bank raises Rs 1,000 cr via bonds

Canara Bank raises Rs 1,000 cr via bonds

AgenciesUpdated: Friday, March 04, 2022, 07:24 PM IST
article-image
The bonds carry coupon rate of 8.07 per cent per annum. / Representational image |

State-owned Canara Bank on Friday said it has raised Rs 1,000 crore by issuing Basel-III compliant additional tier I bonds.

The bonds carry coupon rate of 8.07 per cent per annum.

The issue received overwhelming response from investors, with bids for more than Rs 3,133 crore against a base issue size of Rs 250 crore and greenshoe option of Rs 750 crore, Canara Bank said in a release.

''Based on the response, the bank has decided to accept Rs 1,000 crore at a coupon rate of 8.07 per cent per annum. The said Tier I bonds are perpetual in nature. However, it can be called back by the issuer after fifth anniversary from the deemed date of allotment or any anniversary date thereafter,'' the lender said.

Perpetual bonds carry no maturity date, so they may be treated as equity, not debt. To comply with Basel-III capital regulations, banks globally need to improve and strengthen their capital planning processes.

These norms are being implemented to mitigate concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks.

The bank's additional tier I bonds are rated AA+ by CRISIL Ratings and India Ratings & Research Ltd, the lender said.

This is the third series of additional tier I bond issuance of the bank for the financial year 2021-22, Canara Bank said.

During FY22, the bank has issued Basel-III compliant additional tier-I bonds of Rs 4,000 crore and tier-II bonds of Rs 2,500 crore.

(With inputs from PTI)

RECENT STORIES

Reliance Industries Reports ₹2.73 Lakh Crore Q1 Revenue, Jio And Retail Lead Growth; Mukesh Ambani...

Reliance Industries Reports ₹2.73 Lakh Crore Q1 Revenue, Jio And Retail Lead Growth; Mukesh Ambani...

Bandhan Bank Q1 Net Profit Plunges 65% YoY; NII Falls 7.7% Amid Challenging Environment

Bandhan Bank Q1 Net Profit Plunges 65% YoY; NII Falls 7.7% Amid Challenging Environment

Morgan Stanley Projects RBI Rate Cut In October As India’s Inflation Falls To Multi-Year Low

Morgan Stanley Projects RBI Rate Cut In October As India’s Inflation Falls To Multi-Year Low

JSW Steel Q1 Net Profit Jumps 47% To ₹2,209 Crore Despite 3.7% Drop In Revenue To ₹43,147 Crore

JSW Steel Q1 Net Profit Jumps 47% To ₹2,209 Crore Despite 3.7% Drop In Revenue To ₹43,147 Crore

Sensex Tanks 501 Points, Bank Stock Selloff & FII Outflows Drag Markets

Sensex Tanks 501 Points, Bank Stock Selloff & FII Outflows Drag Markets