Canara Bank To Raise Rs 2,500 Crore Via Bonds

Mumbai: Canara Bank on Friday said it will raise up to Rs 2,500 crore in one or more tranches by issuing Basel III-compliant bonds.

The majority of the public sector lender's directors have consented "to raise additional Tier-I capital funds through Basel-III compliant additional Tier-I perpetual bonds in rupee terms domestically for an amount not exceeding Rs 2,500 crore in single tranche or in tranches depending on the market conditions", it said in a regulatory filing.

The bank said the capital is being raised to maintain a healthy CRAR during the current financial year.

It further said the board has also approved constituting a Bond Committee to determine the structure of the issue size, tenor, coupon, timing of the issue, date of allotment, listing and other matters connected to the issue.

Shares in Canara Bank ended 0.92 per cent higher at Rs 313.3 apiece on the BSE, whose benchmark Sensex index finished up 0.11 per cent.

Indian banks are expected to fully comply with Basel III standards by March 2019 to improve and strengthen their capital planning processes.

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