Tk2,000 crore bond issuance by 5 banks okayed by BSEC
The banks are Dhaka Bank, Bank Asia, Islami Bank, Exim Bank and Trust Bank
The Bangladesh Securities and Exchange Commission (BSEC) yesterday approved the issuance of subordinated bonds totalling Tk2,000 crore by five banks to strengthen their Tier-2 capital base.
All the bonds will be listed on the Alternative Trading Board of the stock exchanges.
The approvals include Tk400 crore each for Dhaka Bank and Bank Asia, Tk500 crore for Islami Bank Bangladesh, Tk250 crore for Export-Import Bank of Bangladesh (Exim Bank), and Tk450 crore for Trust Bank.
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Dhaka Bank's bond will feature unsecured, non-convertible, floating rate, and fully redeemable terms. It will be issued at a face value of Tk10 lakh per unit through private placement among institutional investors and high-net-worth individuals. DBH Finance will act as the Trustee, while BRAC EPL Investments and UCB Investment will be the arrangers.
Bank Asia's bond will also be unsecured and non-convertible, issued at a face value of Tk1 crore per unit through private placement. BRAC EPL Investments will serve as the Trustee, and City Bank Capital Resources will be the arranger. The bank is required to submit a trustee registration certificate to the commission before issuance.
Islami Bank Bangladesh will issue its 5th Mudaraba bond, which will be unsecured, non-convertible, fully redeemable, and have a floating rate. The coupon rate will be the reference rate plus a 3% margin. The bond will be issued at a face value of Tk5 lakh per unit, with DBH Finance as the Trustee and UCB Investment, Prime Bank Investment, and Islami Bank Capital Management as the arrangers. The bank must also submit a trustee registration certificate to the commission.
Exim Bank and Trust Bank will also issue bonds featuring unsecured, non-convertible, fully redeemable, floating rate terms with a coupon rate of reference rate plus 3%. Both will be offered at Tk5 lakh per unit through private placement among institutional investors and high-net-worth individuals. DBH Finance will act as the trustee for Exim Bank's bond, while BRAC EPL Investments will act as the trustee for Trust Bank's bond. UCB Investment will serve as the arranger for both.
These initiatives aim to bolster the banks' capital base while providing investment opportunities for institutional investors and high-net-worth individuals.
