Bank of India Prices ₹2,500 Crore Tier II Bonds at 7.28%

Bank of India has completed a Tier II capital raise via Basel III-compliant bonds worth ₹2,500 crore, locking in a coupon of 7.28% following the bidding process. The issue is part of the bank’s broader capital management strategy to bolster its regulatory capital adequacy and support balance sheet expansion.

The pricing at 7.28% reflects the market’s risk assessment of a mid-to-large PSU bank and comes against a backdrop of relatively stable rate expectations. The additional Tier II capital will also provide a buffer for future credit growth, while helping the bank maintain comfortable capital ratios in line with regulatory norms.

Key Highlights

Tier II bond issuance size: ₹2,500 crore (₹25 billion).

Instrument: Basel III-compliant Tier II bonds.

Accepted coupon: 7.28% through competitive bidding.

Objective: Strengthen Tier II capital and support loan book growth.

Implication: Signals healthy investor appetite and aids capital adequacy optimisation.

Sources: Exchange filing / regulatory disclosure, primary market desk updates, financial news wires.