IOB to raise Rs 700 cr via bonds

Written by Banking Bureau | Mumbai, Aug 26 | Updated: Aug 27 2008, 06:06am hrs
State-run lender, Indian Overseas Bank (IOB) will raise Rs 700 crore through bonds to meet capital requirements.

The board of the bank approved the issue of unsecured, reedemable bonds, which will be raised shortly, the bank said in a filing to the Bombay Stock Exchange. The Chennai-based bank has already raised Rs 300 crore from unsecured bonds last week.

Speaking to FE, SA Bhat, the banks chairman and managing director, said that the sum of Rs 300 crore was raised by his bank through a regular subordinated bond at an interest rate of 10.85%. Now, I am negotiating on what will be the interest rate for raising Rs 700 crore, said Bhat. The bank has projected its capital adequacy ratio, which was at 11.25% at the moment, to be at 11.5% by the end of the fiscal, added Bhat.