PNB to raise up to Rs 3,000 cr through Basel III compliant bonds; key things

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Published: September 19, 2019 6:33:49 PM

Punjab National Bank on Thursday said it will raise up to Rs 3,000 crore by issuing Basel III compliant bonds in one or more tranches.

PNB board approves merger, OBC, united bank of india, bank merger plan, recapitalisation, पीएनबी, मर्जर को सैद्धांतिक मंजूरीBasel III is an international regulatory framework with a set of reforms to improve the regulation, supervision and risk management within the banking sector.

Punjab National Bank on Thursday said it will raise up to Rs 3,000 crore by issuing Basel III compliant bonds in one or more tranches. A meeting of the bank’s board of directors on September 26 for seeking in-principle approval for raising funds, Punjab National Bank said in an exchange filing.  Basel III is an international regulatory framework with a set of reforms to improve the regulation, supervision and risk management within the banking sector.

“The exchange is hereby informed that a meeting of the Board of Directors of the Bank is scheduled on 26.09.2019 for seeking-principle approval for raising funds through Additional Tier-1Basel-III compliant Perpetual Bonds amounting up to Rs. 3000 crore in one or more tranches,” PNB said in a statement.

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To comply with global Basel III capital regulations, banks need to improve and strengthen their capital planning process. These norms are being implemented to mitigate concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks.

Meanwhile, last month, PNB announced linking of their retail loans with the Reserve Bank’s repo rate, which will make loans cheaper. It came after RBI mandated banks to link their loans to any of the external benchmark launched by the FBIL. PNB launched PNB Advantage, a retail lending scheme linked with the repo rate effective on Tuesday. “In the new schemes rate of interest will be 0.25 per cent less than the existing applicable rates based on MCLR. The new rates will vary from 8.25 per cent to 8.35 per cent for housing loan borrowers and 8.65 per cent for car loan borrowers,” PNB said in a statement.Shares of PNB ended the intraday trade at Rs 62, down 0.90 points, or 1.43 per cent on BSE.

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