The money will be raised in one or more tranches in the current and following years, the bank said.
"The Board of Directors of the Company at its meeting held on January 19, 2016 has accorded approval to the Bank to raise Basel-III compliant tier-II bonds for Rs 1,100 crore in one or more tranches in the current or subsequent years based on the requirement," Indian Bank said in regulatory filing.
Indian banks have to be complaint with the Basel-III norms by March 2019 and many banks have been raising capital towards their preparation to that.
RBI has introduced the Basel-III norms in a phased manner since 2013.
The norms are aimed to improve and strengthen regulation, supervision and risk management within the banking sector.
Indian Bank shares closed at Rs 91.25 apiece on BSE, up 1.5 per cent from previous close.