The state-owned Bank of India announced on Wednesday that it has successfully raised ₹2,000 crores (approx. $241 million) through the issuance of Basel III compliant Tier II bonds. The bonds carry a coupon rate of 7.88% per annum.
The bank received robust interest from investors, with a total of 83 bids amounting to ₹3,770 crores. Out of these, the bank accepted 48 bids totaling ₹2,000 crores. The successful fundraising was conducted via the NSE's Electronic Bidding Provider Platform.
The bond issuance includes a base size of ₹1,000 crores and a green shoe option of ₹1,000 crores. The bonds are non-convertible, taxable, subordinated, unsecured, fully paid-up Basel III compliant Tier II Bonds Series XVI in the nature of debentures. The allotment date is set for September 15, 2023.
According to the Bank of India, the Tier II capital was raised to augment the bank's overall capital and enhance its long-term resources in accordance with Reserve Bank of India guidelines. The funds raised will not be directed towards financing any specific project but will be utilized for the bank's regular business activities.
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