IDBI Bank raises Rs 900 cr through Basel-III compliant bonds

Saturday, Jan 2, 2016,17:05 IST By Metrovaartha A A A

New Delhi | Public lender IDBI Bank today said it has raised Rs 900 crore by way of issuing Basel-III compliant tier-II bonds. IDBI Bank mobilised Rs 900 crore today through issue of Basel-III compliant tier-II bonds on private placement basis to strengthen the bank’s capital adequacy, the bank said in a regulatory filing today.

The instrument — IDBI Omni Tier-II 2015-16 series-II — carries a coupon rate of 8.62 per cent per annum. The bond maturity date is January 2, 2026. Many banks have been raising money through tier-II bonds, in their run-up to full Basel-III compliance by March 2019.

The Basel-III norms have been introduced in the Indian banking system since 2013 in a phased manner, with an aim to improve and strengthen regulation, supervision and risk management within the banking sector.

A Fitch Ratings report in December had said banks in India will need about USD 140 billion to ensure full compliance with the Basel III norms by 2018-19.