Home ›› 01 Dec 2021 ›› Stock
The Bangladesh Securities and Exchange Commission (BSEC) has approved the proposal of Premier Bank to collect a Tk 200 crore fund from the capital market through unsecured, non-cumulative, fully paid-up, and contingent-convertible perpetual bonds.
The approval came at a commission meeting held on Tuesday, said a BSEC statement.
The bank will use the fund to strengthen its additional tier-1 capital base.
According to the commission statement, Tk 180 crore will be raised through private placement and Tk 20 crore through an initial public offering in compliance with the commission’s public offer rules. Its unit price is Tk 5,000.
A six per cent base rate for the bond will enable investors to gain annual return secured by a 10 per cent ceiling.
Financial institutions, mutual funds, insurance companies, scheduled banks, regional rural banks, trust, organizations, corporations and high net-worth individuals can purchase the bond.
MTB Capital Limited will act as the trustee of the bond while UCB Investment Limited will act as the issue manager.
Under the Basel-III, a bank should maintain the 12.50 per cent capital adequacy ratio (CAR), where 10 per cent core capital and 2.5 per cent buffer capital.
Under the Tier-1 capital, a bank should maintain 6 per cent capital adequacy and Tier-2 it should maintain 4 per cent. This 10 per cent is mandatory of all banks.
At the same meeting, the initial target of the open-end Ekushey Fund has been increased from Tk 10 crore to Tk 25 crore and the draft prospectus of the fund has been approved subject to the entrepreneur’s participation.
According to the commission statement, except for the portion of the fund held by the entrepreneur, the amount will be open to the general investors.
Ekushey Wealth Management will act as the manager of the fund while Sandhani Life Insurance and Brac Bank will play the role of trustee and custodian respectively.
