Canara Bank raises Rs 5,000 crore via 10-year tier-II bonds at 7.24 pc coupon

Mumbai, Feb 26 (PTI) State-run lender Canara Bank on Thursday raised Rs 5,000 crore through a bond sale.

The Basel III-compliant Tier-II bonds maturing in 10 years have been sold at a coupon rate of 7.24 per cent, market sources said.

The base issue was Rs 2,000 crore, while the rest has been raised utilising the greenshoe option, they said.

The lender received five bids for a cumulative amount of Rs 1,970 crore at 7.20 per cent coupon, two bids each for a cumulative value of Rs 2,970 crore, Rs 3,610 crore, and Rs 4,430 crore, at a coupon rate of 7.21 per cent, 7.22 per cent, and 7.23 per cent, respectively, market participants said.

Additionally, the bank received five bids for a cumulative amount of Rs 5,350 crore at 7.24 per cent coupon, and two bids for a cumulative amount of Rs 5,403 crore at 7.25 per cent coupon, market participants added.

The lender accepted the bid at 7.24 per cent, choosing to raise till the upper limit of Rs 5,000 crore, they said.

The bonds have a call option at the end of 5th year and thereafter every year. The bonds have been rated 'AAA' with 'Stable' outlook by Icra and India Ratings.

The Canara Bank scrip closed 0.06 per cent up at Rs 158.75 a piece on the BSE on Thursday, as against a 0.03 per cent correction on the benchmark. PTI MSU AA MR