Dhaka: The Bangladesh Securities and Exchange Commission (BSEC) has given the green light for bond issuance proposals from three banks, marking a significant development in the financial sector. The banks receiving approval are BRAC Bank PLC, United Commercial Bank PLC, and Trust Bank PLC.
According to Bangladesh Sangbad Sangstha, the approval was finalized during the commission's 975th meeting, which was chaired by BSEC Chairman Khondoker Rashed Maqsood. The decision allows BRAC Bank PLC to issue an unsecured, non-convertible, fully redeemable, floating-rate social subordinated bond. This bond is valued at Tk 10.0 billion and will feature a coupon rate of the Reference Rate plus a 2.5 percent margin. The bond will be privately placed among institutional investors at a face value of Tk 10 lakh per unit, with Prime Bank Investment Limited serving as the trustee and BRAC EPL Investment Limited as the arranger. Additionally, the bond will be listed on the Alternative Trading Board (ATB).
United Commercial Bank PLC received approval to issue a similar bond, which is unsecured, non-convertible, and redeemable with a floating-rate. This bond is worth Tk 8.0 billion and carries a coupon rate of the Reference Rate plus a 3 percent margin. It will be placed privately with institutional investors at Tk 100,000 per unit. DBH Finance PLC will serve as the trustee, while UCB Investment Limited will act as the arranger. The bond will also be listed on the ATB.
Trust Bank PLC has been approved to issue an unsecured, non-convertible, redeemable, floating-rate subordinated bond valued at Tk 5.0 billion, with a coupon rate of the Reference Rate plus a 3 percent margin. This bond will also be privately placed with institutional investors at Tk 100,000 per unit, with DBH Finance PLC acting as the trustee and UCB Investment Limited and Trust Bank Investment PLC as arrangers. This bond will also be listed on the ATB.
The funds generated from these bond issues are intended to strengthen the Tier-II capital base of the respective banks, thereby enhancing their capital adequacy in alignment with Basel III requirements.