"The bank has raised Basel III compliant Additional Tier I bonds of Rs 325 crore through private placement at coupon rate of 10.49 per cent," Vijaya Bank said in a regulatory filing to stock exchanges.
Under the Basel-III norms, AT-1 bonds come with loss absorbency features, meaning that in case of stress, banks can write off such investments or convert them into common equity if approved by the RBI.
AT-1 bonds, which qualify as core or equity capital, are one of the means of raising capital by banks.