BoB, Axis plan to raise Rs 6,500 crore via bond issues
Bank of Baroda and Axis Bank are considering raising funds totalling ₹6,500 crore through bonds to boost their capital base, said market sources.
State-run Bank of Baroda will likely offer tier-2 bonds worth ₹3,500 crore for 15 years, while private lender Axis Bank is looking at raising ₹3,000 crore through tier-1 bonds.
This comes immediately after the country's largest bank, State Bank of India, raised ₹10,000 crore of infrastructure bonds at 7.23% for 15 years.
«The exact coupon rate and tenure are yet to be finalised, but some investors were called by officials of these respective banks to find out the levels,» said a market source on the condition of anonymity.
The money raised by banks in the form of tier-1 and tier-2 capital will help them improve their capital adequacy ratio. As of September 2024, the capital adequacy ratio for Axis Bank was 16.61%, while for Bank of Baroda, it was 16.26%.
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