2 hrs ago
Federal Bank Wins Approval for $500 Million Bond Programme
Federal Bank wants to raise money by selling bonds.
Its board approved a plan that could allow up to $500 million in total bond sales.
The bank can sell these bonds in one or more batches instead of all at once.
Some bonds may be sold in foreign currencies.
Investors may be able to buy them through the bank’s branches and its GIFT City unit.
The bank has not yet said when each sale will happen or what its price will be.
Federal Bank also reported that its profit and interest income increased in the June quarter.
Its problem-loan levels improved compared with the previous quarter.
Federal Bank’s board approved a medium-term note programme with an overall limit of $500 million.
The programme allows secured or unsecured bonds, including foreign-currency notes, to be issued in multiple tranches.
Eligible investors may be offered the securities through the bank’s branches, head office and GIFT City banking unit.
Individual issuance timing, pricing and size have not been disclosed, and the $500 million is not a single transaction.
The bank reported higher June-quarter profits and net interest income, while gross and net non-performing assets improved.
- Who
- Federal Bank and its board.
- What
- The board approved a medium-term note programme of up to $500 million for bond and foreign-currency note issuances.
- Where
- The securities may be offered through Federal Bank branches, its head office and its banking unit in GIFT City, and may be listed on international exchanges.
- When
- The approval was given on Thursday, modifying an earlier decision from August 21; the bank had communicated the proposed programme on September 11.
- Why
- The programme is intended to let Federal Bank raise funds through bonds and foreign-currency notes as needed.
Key facts
- Programme limit
- Up to $500 million
- Security types
- Secured or unsecured bonds, including foreign-currency notes
- Issuance structure
- One or more tranches under a medium-term note framework
- Potential listing venues
- India International Exchange (IFSC) and NSE IFSC, depending on issue terms
- June-quarter net interest income
- ₹2,946 crore, up 26% year on year
- June-quarter net profit
- ₹1,177 crore, up 36.5% year on year
- Gross non-performing asset ratio
- 1.52%, down from 1.62% in the previous quarter
Sources
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