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The board of directors of government-owned Punjab National Bank (PNB) on Tuesday approved fundraising of up to ₹12,000 crore through the issuance of bonds that are Basel III compliant.
From the total, PNB will raise Basel III compliant AT-1 Bonds of up to ₹5,500 crore and Tier II Bonds to ₹6,500 crore.
The fundraising will be done in one or more tranches.
Basel 3 compliant AT1 bonds are popularly perpetual debt instruments and do not carry any maturity date. Since these bonds do not have any maturity period, lenders then have a call option that allows them to redeem these bonds during a scheduled period.
Tier II bonds consist of undisclosed reserves, revaluation reserves, general provisions and loss reserves, hybrid capital instruments, subordinated debt, and investment reserve accounts.
On BSE, PNB shares ended at ₹34.95 apiece down by 1.96%. The shares have touched an intraday high and low of ₹36 apiece and ₹34.85 apiece respectively.
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