Public sector Punjab National Bank (PNB) today said it has raised Rs 1,500 crore by issuing Basel III compliant bonds on private placement basis.
"The bank has raised Rs 1,500 crore additional tier-I (Basel III compliant) capital bonds at a coupon of 8.98 per cent per annum on private placement basis," PNB said in a regulatory filing.
To comply with Basel III Capital Regulations, banks need to improve and strengthen their capital planning processes.
These norms are being implemented to mitigate concerns on potential stresses on asset quality and consequential impact on performance and profitability of banks.
Indian banking system has been implementing Basel III standards in phases since April 1, 2013. The banks are expected to fully implement these norms by March 2019 against an internationally agreed deadline of January 1, 2019.
Late last month, the Finance Ministry made a case for pushing back the Basel III compliance deadline in view of higher capital requirement of banks as they are struggling to deal with bad loans which have reached unacceptable levels.
As per senior officials in the ministry, a delay will help banks fulfil their capital needs and increase credit flow to productive sectors along with balance sheet clean-up.
Stock of Punjab National Bank closed 1.02 per cent up at Rs 162.95 on BSE.
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