Business Desk :
Meghna Bank and Southeast Bank have got permission to issue subordinated bonds to raise funds.
The subordinated bond is a debt that is ranked below other debt in terms of claims on assets.
In case of a default, the holder of a subordinated debt cannot satisfy claims on the borrower’s assets until the claims of the holders of senior debt are met.
Bangladesh Securities and Exchange Commission (BSEC) took the decision in a board meeting on Sunday.
Southeast Bank would issue a non-convertible unsecured floating rate bond worth Tk 500 crore through private placement.
Each unit of the bond is Tk 1 crore and its coupon rate ranges from 7 per cent to 9 per cent.
It would be issued to financial institutions, mutual funds, insurance companies, listed banks, corporates and other eligible investors.
With the bond proceeds, the lender will strengthen its capital base of additional Tier-II.
Meghna Bank got the approval of its non-convertible, fully redeemable, coupon-bearing subordinated bond worth Tk 200 crore.
Its coupon rate ranges from 7 per cent to 9 per cent which would be issued to an institutional investor and other eligible investors.
The face value of each unit of the bond is Tk 1 crore. With the bond proceeds, the bank will strengthen its capital base of additional Tier-II.
