Banks raise over Rs 37,000 cr via AT1 bonds amid capital ratio concern

Call options for instruments raised last year and worth Rs 28,430 crore are due in the next financial year.

Indian banks have raised more than Rs 37,000 crore by issuing new Additional Tier 1 bonds (AT1) this financial year (FY22). The amount is higher than Rs 28,430 crore worth AT1 bonds for which call options are due in the FY22, addressing concerns on rollovers and capital ratios.

According to rating agency ICRA, Rs 20,505 crore of AT-I bonds of public sector banks (PSBs) and Rs 7,925-crore bonds of private sector banks (PVBs) are due for exercise of call option. Most bonds (worth Rs 19,750 crore) are due in the second half (H2 FY2022).

All PSBs have largely raised AT-I