Punjab & Sind Bank raises Rs 1,000 crore via bonds

Public sector lender Punjab & Sind Bank today said it has alloted Basel III compliant bonds on private placement basis to raise Rs 1,000 crore.

"Allotment of Basel-III compliant additional tier-1 (AT- 1) bonds with coupon of 10.90 per cent per annum on private placement basis has been done on May 8, 2017," the bank said in a regulatory filing.

The bonds allotted are perpetual in nature, meaning there is no maturity period and it can be converted to equity as well.

Under the Basel-III norms, AT-1 bonds come with loss absorbency features.

In cases of stress, banks can write off such investments or convert them into common equity if approved by the Reserve Bank of India.

Shares of Punjab and Sind Bank closed 0.44 per cent up at Rs 68.20 on BSE.