Union Bank of India raises Rs 750 cr via bonds
The bank has issued 7,500 non-convertible, unsecured
subordinated Basel III compliant perpetual debt instruments for
inclusion in additional tier-I capital, it said in a regulatory filing.The bond is issued for face value of Rs 10 lakh each at par aggregating to Rs 750 crore on private placement basis, it added.
Perpetual bonds carry no maturity period and can be treated as equity not as debt.The bonds, issued on a private placement basis, bears interest rate of 9.10% per annum payable annually.
They are rated BWR AA+/Stable by Brickwork Rating and IND AA by India Ratings.Banks
have to strengthen capital base, as per Basel-III Capital Regulations,
so as to mitigate concerns emanating from potential stresses on asset
quality and consequential impact on performance and profitability of
banks.
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