BoB plans bond issue worth Rs 1,000 crore

Mumbai, Aug 30: State-owned Bank of Baroda (BOB) has proposed to make bond issue worth Rs 1,000 crore with a view of augmenting its capital.

Announcing this in a notice to BSE, the Bank said BoB plans to issue fresh 116 months unsecured non convertible redeemable, subordinated bonds (Lower Tier II Bonds - Series VI) of the face value of Rs 10 lakh each for cash aggregating up to Rs 1,000 crore (with green shoe option of Rs 500 crore) in the first week of September 2006 on private placement basis at a fixed coupon rate of 8.95 per cent a year.

The issue has been rated 'AAA/Stable' by CRISIL and 'LAAA' by ICRA.

The bonds will be listed on NSEIL and BSE. IDBI Trusteeship Services Ltd will be the trustee to the bond issue.

The bank was in news recently when it announced its plans for overseas expansion to increase the share of its overseas business to around 20% to 22% within the next three years.

''It will be shortly applying to RBI for opening branches in Mozambique, Qatar, Ghana, Johannesburg, Bahrain and Kuwait. It has already obtained approval to open branches in New Zealand, Australia and Maldives,'' said Mr Anil K Khandelwal, BoB's chairman and managing director.

BoB is eyeing a 45 per cent growth in overseas business this year, while on the domestic front, the bank is all set to refurbish its subsidiary and associate institutions.

UNI