Bank of Baroda informed stock markets on November 18 that its capital raising committee has granted the go-ahead to raise up to 15,000 crore, with no more than 5,000 crore raised through the issuance of tier-II debt bonds and a maximum of 10,000 crore raised through infrastructure bonds.
The decision to raise the cash was made earlier in the day during the committee meeting, according to a regulatory filing by the public sector lender.
Concerning the proposed fundraise via tier-II debt bonds, the bank stated that the panel has approved the issuing of 2,000 crore through 10-year tier-II bonds, as well as the raising of an additional 3,000 crore through the greenshoe option.
"Capital Raising Committee of our Bank in its meeting held today i.e. 18.11.2023 has approved the issuance of 2,000 crore Tier II/sub debt bond with the greenshoe option to raise another 3,000 crore totalling 5,000 crore (10 years with call option at the end of 5 years)," the press release added.
The bank has also opted to sell 2,000 crore in 7-year infrastructure bonds, "with a greenshoe option to raise an additional 8000 crores totaling the issue size of 10,000 crore," it added.
The news comes more than a month after the bank said in a regulatory filing on October 11 that its board of directors had authorised a plan to raise 10,000 crore to fund affordable housing and infrastructure projects.
The state-owned institution posted a net profit of 4,253 crore in the quarter ending September 2023, up 28 percent from 4,001 crore the previous year.
The bank's total income increased to 32,033 crore in the second quarter, up from 23,080 crore in the same time the previous year. The lender's stock closed at 196.65 on the BSE in the most recent trading session on November 17, down 0.91 percent from the previous day's closing.
