Union Bank of India raises Rs 663 crore from bonds

State-owned Union Bank of India on Friday said it has raised Rs 663 crore from Tier I bonds to fund business growth.

"…the bank has allotted unsecured, subordinated, non-convertible, perpetual, taxable, fully paid-up Basel III compliant Additional Tier 1 bonds (AT-1) in the nature of debentures eligible for inclusion in Tier 1 Capital," Union Bank of India said in a regulatory filing.

The bank raised Rs 663 crore in aggregate from these bonds, it said.

Under the Basel-III norms, AT-1 bonds come with loss absorbency features, meaning that in case of stress, banks can write off such investments or convert them into common equity if approved by the Reserve Bank of India.