Eastern Bank gets BSEC nod to issue Tk800cr subordinated bond

The Bangladesh Securities and Exchange Commission (BSEC) has approved Eastern Bank PLC's proposal to issue a Tk800 crore subordinated bond, paving the way for the private commercial bank to further strengthen its capital base under the Basel III framework.

The approval was granted at a commission meeting held on Wednesday, according to a press release issued by the securities regulator. 

With the green light from the BSEC, Eastern Bank will now be able to raise long-term funds through the capital market to reinforce its Tier-2 capital and support future business growth.

According to the press release, the bond will be unsecured, non-convertible, fully redeemable and coupon-bearing, with a floating interest rate structure. The coupon rate will be set at a reference rate plus a margin of 3%. Each bond will have a face value of Tk10 lakh.

Eastern Bank plans to issue the bond through private placement, targeting corporate entities, high net worth individuals, banks, non-bank financial institutions and insurance companies. 

The bond will also be listed on the Alternative Trading Board (ATB) of the stock exchanges, allowing for secondary market trading.

DBH Finance has been appointed as the trustee of the bond, while EBL Investment Limited will act as the arranger for the issuance.

The bond issuance comes at a time when Eastern Bank has been reporting solid financial performance. On a solo basis, the bank reported a profit of Tk627 crore in the first nine months of 2025, representing a 20% growth compared to the same period of the previous year.

According to the bank's disclosures, a strong emphasis on asset quality has enabled Eastern Bank to maintain a non-performing loan (NPL) ratio of 3.07% as of September 2025, significantly lower than the industry average. 

The bank has also maintained excess provisions of Tk144 crore over the required loan loss provisions to enhance its shock-absorbing capacity under stressed scenarios.

Eastern Bank's operational efficiency also remained strong, with a cost-to-income ratio of 41.17%, reflecting prudent cost management practices.

For the year 2024, the bank declared a 17.50% cash dividend along with a 17.50% stock dividend. In that year, it reported a consolidated net profit of Tk660 crore and earnings per share of Tk4.86.

Shares of Eastern Bank closed at Tk23.30 on the Dhaka Stock Exchange today.