Bank of India Raises Rs 2,690 Crore Through Infrastructure Bonds at 7.5% Interest Rate
Bank of India (BoI) successfully raised Rs 2,690 crore by issuing 10-year infrastructure bonds at an interest rate of 7.5%. This is the bank’s third infrastructure bond issuance in the current financial year, marking a significant milestone in its fundraising efforts.
Mumbai: Bank of India (BoI) successfully raised Rs 2,690 crore by issuing 10-year infrastructure bonds at an interest rate of 7.5%. This is the bank’s third infrastructure bond issuance in the current financial year, marking a significant milestone in its fundraising efforts.
The infrastructure bonds were issued via the NSE Electronic Bidding Platform, and the funds raised will be used to finance infrastructure projects and affordable housing, in line with the Reserve Bank of India’s (RBI) guidelines.
Table of Contents
Strong Demand and Oversubscription for Bank of India’s Infrastructure Bonds
The bond issuance initially aimed to raise Rs 1,500 crore, with the option to increase the amount up to Rs 3,500 crore. However, due to overwhelming demand, the bank received 94 bids totaling Rs 8,845 crore, nearly six times the base issue size. After evaluating the bids, BoI accepted 26 bids and finalized the issuance at Rs 2,690 crore.
Bank of India’s Ongoing Fundraising Strategy
Over the past nine months, Bank of India has raised Rs 12,500 crore through multiple bond offerings, demonstrating its active strategy for fundraising. Notably, the bank had earlier raised Rs 2,500 crore through Basel III Tier-II bonds in September, at an interest rate of 7.49%, and issued Rs 5,000 crore each in infrastructure bonds in July and November at interest rates of 7.54% and 7.41%, respectively.
Also Read: FIR Filed Against New India Cooperative Bank GM in Rs 122 Crore Financial Fraud
Bank’s Role in Financing Key Infrastructure and Housing Sectors
The funds raised through this infrastructure bond offering will contribute to the overall funding of critical sectors, including infrastructure and affordable housing, without being allocated to any specific project.
RBI’s Continued Support for Liquidity in the Banking System
In a related development, the Reserve Bank of India (RBI) announced last month that it would inject Rs 110,000 crore in liquidity into the banking system. This move comes after a review of the current liquidity and financial conditions, and is intended to support economic activities during uncertain financial times.
With strong investor interest and its continued successful bond offerings, Bank of India remains well-positioned to support key infrastructure and housing projects across the country.
