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Our Bureau

Mangalore , Feb. 22

CORPORATION Bank will raise Tier II capital to the extent of Rs 500 crore and issue long-term infrastructure bonds to the tune of Rs 1,000 crore.

A bank release said here on Wednesday that the bank has proposed to raise Tier II capital by way of non-convertible subordinated debts to the extent of Rs 500 crore in one or more tranches.

Stating that the capital adequacy ratio of the bank stood at 14.91 per cent at the end of December 31, 2005, it said the bank was poised for growth during the coming years.

As per the Basel II requirements there will be an additional capital charge for credit , market and operational risk. In order to be prepared for the projected increase in credit and Basel II requirements, the bank has proposed to raise capital funds to the extent of Rs 500 crore by way of issue of Tier II bonds, the release said.

For financing infrastructure projects, the bank proposes to issue long-term bonds to the extent of Rs 1,000 crore in one or more tranches. In view of the deployment opportunity and national importance attached to infrastructure lending, the bank has been participating in financing infrastructure for the past few years. Currently, the bank's deployment of credit to infrastructure forms 8.6 per cent of the net bank credit.

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