Mutual Trust Bank to raise Tk345cr in Tier-1 capital

Mutual Trust Bank PLC has announced plans to raise Tk346 crore in Tier-1 capital to strengthen its core capital base and support future growth.

The decision was taken at a meeting of the bank's board of directors and is subject to approval from the relevant regulatory authorities, according to a disclosure filed with the Dhaka Stock Exchange on Thursday (22 January).

The proposed capital raising represents about 32% of the bank's existing paid-up capital, which currently stands at Tk1,081 crore.

As of the end of 2024, Mutual Trust Bank's consolidated Tier-1 capital amounted to Tk2,467.53 crore, while its capital to risk-weighted assets ratio (CRAR) stood at 13.62%, comfortably above the regulatory requirement of 12.50%.

Speaking to The Business Standard, the bank's Managing Director, Syed Mahbubur Rahman, said the board's decision was driven by the need to further strengthen the bank's risk-based capital position amid a changing economic and regulatory environment.

He noted that the capital may be raised through a rights offer, issuance of preference shares, bonds, or another instrument in line with Bangladesh Securities and Exchange Commission regulations.

Tier-1 capital, often referred to as core capital, is considered the highest quality capital for banks as it primarily consists of common equity, retained earnings and disclosed reserves. It serves as a key buffer to absorb losses and is a critical indicator of a bank's financial strength under the Basel regulatory framework.

According to the bank's unaudited financial statements, the bank posted a net profit of Tk203.84 crore during the January–September period of 2025, nearly unchanged from Tk203.74 crore in the same period a year earlier. Its earnings per share also remained steady at Tk1.88.

For the full year of 2024, the private sector lender reported a net profit of Tk316.65 crore with an EPS of Tk3.22, and distributed a 10% stock dividend to its shareholders.