Dutch-Bangla Bank’s Tk 1,200cr bond gets nod

The Bangladesh Securities and Exchange Commission has approved Dutch-Bangla Bank's plan to raise Tk 1,200 crore through subordinated bonds, according to a stock exchange disclosure.

The bonds will be fully redeemable, non-convertible, unsecured, and floating rate subordinated bonds.

The private bank plans to issue 1,200 bonds, each with a face value of Tk 1 crore, to bolster its Tier-2 capital under Basel III regulations and enhance its regulatory capital base.

A fully redeemable, non-convertible, unsecured, floating rate subordinated bond is a debt instrument that must be repaid in full upon maturity and cannot be converted into equity. It is not backed by collateral and carries a variable interest rate.

It is considered subordinated as it ranks below other debts in claims during liquidation.

Dutch-Bangla Bank's disclosure follows its announcement on December 28, 2023, regarding the board's decision to proceed with the bond issuance.

Shares of Dutch-Bangla Bank fell by 0.78 percent to Tk 51.2 during mid-day trading on the DSE yesterday.