Subscription ends for City Bank’s Tk 400cr perpetual bond
City Bank has organised the subscription closing ceremony of a Tk 400 crore bond, which is the country's first ever Basel-III compliant, additional Tier-I, contingent-convertible perpetual instrument of its kind.
A perpetual bond is a fixed income security with no maturity date and is often considered as a type of equity rather than debt.
City Bank Capital was the mandated arranger to the issue.
This bond will pave the way for recapitalisation of banks through optimising their capital structure via a more efficient mix of debt and equity, the bank said in a press release.
This is an effective alternative to raising capital from existing shareholders and this instrument is expected to become a critical tool to support expansion of the banking sector in the coming years, it said.
Salman F Rahman, private industry and investment adviser to the prime minister, delivered a video speech at the event, held at Westin Dhaka on Tuesday, where several stakeholders and well-wishers of the bank also attended.
Shibli Rubayat Ul Islam, chairman of the Bangladesh Securities and Exchange Commission; Ahmed Jamal, deputy governor of Bangladesh Bank; Aziz Al Kaiser, chairman of City Bank, and Aziz Al Mahmood, chairman of City Bank Capital Resources, were also present.
The bank entered into partnerships with several institutions for successfully issuing the floating-rate perpetual bond.
The issue enhanced Tier-I capital of City Bank following "Guideline of Risk Based Capital Adequacy" of Bangladesh Bank; therefore, ultimately increased issuer's total capital adequacy ratio.
Mashrur Arefin, managing director and CEO of City Bank, and Ershad Hossain, managing director and CEO of City Bank Capital, expressed gratitude to the subscribers, regulators and all others who were involved with the issuance process.
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