Sonali Bank has sought Tk 10,000 crore from perpetual bonds to meet further capital shortfall that the Covid-19 pandemic has caused the bank.
The bank fears its operating profit would slip by Tk 800 crore this year.
The country's largest state-owned bank made some Tk190 crore as operating profit in 2019. But it failed to minimize capital shortfall due to high non-performing loans.
A perpetual bond is often considered a type of equity, rather than debt. One major drawback to it is that it is not redeemable. However, the major benefit of it is that it allows a steady stream of interest payment.
Sonali Bank managing director Ataur Rahman Prodhan said like the economy, the entire banking sector will also face the severe impacts of coronavirus.
"The profit of the bank will definitely see a downward trend as business activities in the country has remained almost stagnant for months," in a letter sent to the finance division he said.
Prodhan has proposed three options to minimize capital shortfall of the bank which include--- providing cash support from the exchequer, issuing bank guarantee that can be considered capital by the central bank, and issuance of perpetual bonds.
