Trust Bank to issue Tk800cr bond

Trust Bank, a private sector lender, has decided to raise Tk800 crore through issuing bonds, aiming to enhance its capital base.

According to its price-sensitive statement filed on the Dhaka Stock Exchange (DSE), the floating rate non-convertible subordinate bond aimed at raising regulatory capital (tier-2) is expected to help the bank fulfil its Basel-III requirements.

The decision to issue the bond was approved by Trust Bank's board of directors at a meeting on Tuesday (27 May), reads the statement.

The issuance of the bond is subject to approval from the BSEC and the Bangladesh Bank.

Currently, the local bond market is dominated by subordinated bonds, mainly issued by banks. The bonds help lenders construct their mandatory tier-2 capital base through proceeding within a specific tenure.

The Bangladesh Bank is implementing Basel-III in the local banking industry to ensure that banks have adequate capital to avert systemic risk.

Basel-III is an international regulatory accord that introduced a set of reforms designed to mitigate risk within the international banking sector by requiring banks to maintain proper leverage ratios and keep certain levels of reserve capital.

However, following the bond issuance decision, Trust Bank's share price rose by 1.04% and reached Tk19.40. 

Meanwhile, its consolidated net profit for the January-March quarter of 2025 fell by 7% to Tk29.37 crore compared to the same period last year.

According to the price-sensitive information of the private sector lender, its consolidated earnings per share were Tk0.32, lower from Tk0.35 a year ago.

It had recommended a 7.50% cash and 7.50% stock dividend to its shareholders for the last year. Its consolidated net profit was Tk372 crore, an 11% decrease from the previous year.

To approve the dividend and the audited financial statement, the bank will conduct the annual general meeting on 28 July, while the record date is 29 May.