In a significant financial move, Punjab National Bank (PNB) has accomplished the successful issuance of Basel-III additional Tier-I bonds, raising a total of ₹1,153 crore. The bond issuance, executed at an attractive coupon rate of 8.55%, not only meets but surpasses market expectations, showcasing PNB’s adept financial management and capital enhancement strategies.
Earlier reports on December 21 hinted at PNB’s plan to raise funds, with projections of up to ₹3,000 crore through the issuance of bonds. The structured issuance comprised a base size of ₹500 crore, accompanied by a greenshoe option of ₹2,500 crore, providing flexibility for PNB to raise additional funds as needed.
Crucially, these Basel-III bonds feature a call option, which can be exercised on the fifth anniversary from the deemed date of allotment or any subsequent anniversary, subject to prior approval from the Reserve Bank of India (RBI). This strategic move not only strengthens PNB’s capital base but also underscores its commitment to maintaining a robust financial position.
The pay-in date for the bonds has been scheduled for December 2, marking the official exchange of funds and bonds between PNB and its investors. This successful completion of the bond issuance further solidifies PNB’s standing in the financial landscape, reflecting its proactive approach to financial planning and capital management.
