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The International Finance Investment and Commerce Bank, better known as IFIC Bank, is going to raise Tk 600 crore by issuing perpetual bonds to comply with BASEL-III norms, according to a disclosure posted on the Dhaka Stock Exchange (DSE) website on Thursday.
As per the decision, to raise the Tier II capital as per BASEL III guidelines, the company will issue Fully Redeemable, Non-convertible, Unsecured and Subordinated Zero-Coupon Bonds subject to the approval of Bangladesh Bank (BB) and Bangladesh Securities and Exchange Commission (BSEC).
Earlier, the bank had issued bonds worth Tk 2,500 crore in the last three years.
On August 25, 2022, the bank’s Board of Directors decided to issue bonds worth Tk 500 crore. On Thursday, the DSE website said it had cancelled the earlier decision.
To issue the aforementioned bond, the board has also decided to withdraw the previous proposal for issuance of an IFIC Bank Non-Convertible Coupon Bearing Subordinated Bond of Tk 500 crore approved in its 836th meeting held on August 25, 2022.
On October 10, 2023, the DSE approved the listing of IFIC 2nd and 3rd non-convertible, redeemable, unsecured, floating rate subordinated bonds under the ATB of the DSE as per the regulations of the Alternative Trading Board.
On June 30, 2021, BSEC gave its consent to raise Tier 2 capital of IFIC Bank by issuing two 'Non-Convertible, Unsecured Floating Rate Subordinated Bond(s)' worth Tk 500 crore each only through private placement.
On August 8, 2022, IFIC Bank similarly announced an on-convertible coupon-bearing subordinated bond of Tk 500 crore. This was the fourth non-convertible coupon-bearing subordinated bond for Tier 2 capital as per BASEL III.
IFIC Bank also issued a Tk 1,000 crore perpetual bond to comply with BASEL-III norms in June 2021.
As per the then decision of the bank, Tk 900 crore was collected through private placement and Tk 100 crore through public offer.
Q1 of 2024
IFIC Bank reported a 35 per cent year-on-year fall in profit in the first quarter of 2024. The profit stood at Tk 40.27 crore in the January-March period of this year. It was Tk 62.23 crore in the same period last year.
Therefore, the consolidated earnings per share (EPS) decreased to Tk 0.22 from Tk 0.34.
The consolidated net operating cash flow per share (NOCFPS) saw a significant increase of 206 per cent, rising to Tk 3.16 in Q1 of 2024 from negative Tk 2.97 in the same period of 2023. The bank credited a high increase in deposits for the NOCFPS growth.
The consolidated net asset value per share was Tk 19.96 on March 31 this year. It was Tk 18.70 on the same day last year.
IFIC Bank was established in 1976 as a joint venture between the Bangladesh government and sponsors in the private sector.
Currently, the government holds a 32.75 per cent stake in the bank, while sponsors and directors own 6.14 per cent. The rest is held by both local and foreign institutions and general shareholders.
With a paid-up capital of Tk 1,922 crore, IFIC Bank operates with 187 branches and 1,145 sub-branches across the country.
IFIC's shares increased by 2.38 per cent to Tk 8.60 at DSE on Thursday.
