State-owned Punjab National Bank (PNB) has raised Rs 1,500 crore by issuing Basel III compliant bonds.
The bank said it will use fresh funding for business expansion. "Our bank has issued and allotted Rs 1,500 crore tier II Basel III compliant capital bonds at a coupon of 8.15 per cent per annum on private placement basis," PNB said in a regulatory filing.
The lender has issued 15,000 redeemable Basel III compliant tier II bonds in the nature of debenture of Rs10 lakh each, it said.
To comply with Basel III capital regulations, banks 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.
At 10:45 am, the share price of PNB moved up by 4.62 per cent on BSE Ltd to Rs 65.70 apiece.