Three listed companies have received the go-ahead from the Bangladesh Securities and Exchange Commission (BSEC) to raise Tk1,600 crore by issuing bonds.
Of the three firms, LankaBangla Finance Limited will raise Tk300 crore, Shahjalal Islami Bank Tk500 crore, and Islami Bank Bangladesh Ltd will raise Tk800 crore.
The securities regulator approved the bond issue at its 790th commission meeting on Sunday.
The regulator approved a non-convertible zero-coupon bond of Tk265.33 crore (face value up to Tk300 crore) in favour of LankaBangla Finance Limited.
The company will reinvest and provide loans in corporate, retail, and Small and Medium Enterprises (SMEs) with this bond.
A zero-coupon bond is simply a discount bond originally sold at a discount from its face value instead of periodic dividend payments or interest.
Face value is the amount paid to the bondholders at maturity.
The discount rate of the bond is 7.25-9%, to be sold to banks, mutual funds, insurance firms, corporate bodies, financial institutions, organisations, and other institutional investors through private placements.
Each lot of the bond amounts to Tk53.06 lakh. IIDFC Capital Ltd will act as the trustee and Green Delta Capital Ltd will be the arranger of the bond.
Shahjalal Islami Bank
The regulator has allowed Shahjalal Islami Bank to issue a perpetual bond worth Tk500 crore to strengthen the Tier-1 capital base of the bank.
Shahjalal Islami Bank will issue Tk450 crore in bonds through private placements, and Tk50 crore through public offerings.
The features of the bond are that they are unsecured, contingent-convertible, fully paid-up, non-cumulative, and Basel-3 compliant perpetual bonds.
Investors will receive 6-10% interest against the bonds. The face value of the bond units will be Tk5000 for public offerings and Tk5 crore for the private placements.
Institutional and other qualified investors will be offered the bond units in private placement.
MTB Capital, a local investment bank, will act as the trustee of the bond, while non-bank financial institutions Islami Bank Capital Management Ltd and UCB investment Ltd are the issue managers of the bond offerings.
Islami Bank Bangladesh
Islami Bank Bangladesh has got permission to issue a perpetual bond worth Tk800 crore to strengthen the additional Tier-1 capital base of the bank.
The bank will raise Tk720 crore by issuing bonds through private placements, and will issue the remaining Tk80 crore in public offer bonds.
The features of the bond are that they are unsecured, contingent-convertible, fully paid-up, floating rate, non-cumulative, and Basel-3 compliant 2nd perpetual bonds.
The face value of the bond units will be Tk5,000. Institutional and other qualified investors will be offered the bond units in private placement.
SBL Capital Management Ltd will act as the trustee of the bond issue, while non-bank financial institutions Prime Bank Investment Ltd and UCB investment Ltd are to be the bond issue managers.