Canara Bank raises Rs 1,000 cr via Basel-III bonds

Public sector Canara Bank has raised Rs 1,000 crore of the permitted amount of Rs 2,500 crore by issuing Basel-III complaint tier-I bonds with a coupon rate of 8.60 per cent per annum.

“The bank has raised an amount of Rs 1,000 crore as tranche-I on December 13, 2016 with a coupon of 8.6 per cent per annum,” Canara Bank said in a notification to stock exchanges.

In October, the board of Canara Bank had permitted it to raise additional tier-I capital funds by issuing of Basel-III compliant tier-I perpetual in rupee terms domestically for an amount not exceeding Rs 2,500 crore.

The bank said the capital is being raised to maintain healthy CRAR during the current financial year.

Indian banks are expected to fully comply with Basel-III standards by March 2019 to improve and strengthen their capital planning processes.

The norms are being implemented to soothe concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks.

Shares of the bank were trading 0.39 per cent down at Rs 303.75 apiece on the BSE.