AB Bank bond subscription period extended to Aug 22

The subscription period of AB Bank Perpetual Bond for general public and eligible investors through the electronic subscription system of the stock exchanges has been extended until August 22 due to poor response.

As per earlier schedule, the bank’s bond subscription time did not declare aiming to raise Tk 600 Crore with Face value Tk 1000.

The subscription period of the bond has been extended as per Bangladesh Securities and Exchange letter dated May 22, said the bank in a filing with the Dhaka Stock Exchange (DSE) on Sunday. However, AB Bank Perpetual Bond already was two time extension subscription period from 16 February and 22 May.

The general public, including non-resident Bangladeshis (NRBs) can apply through stockbrokers or merchant banks while the eligible investors can participate through electronic subscription system (ESS).

A perpetual bond is a fixed income security with no maturity date and is often considered as a type of equity rather than debt. These types of bonds are not redeemable but instead provide a never-ending stream of interest payments.

Last year on November 23, 2021, BSEC accorded its consent to AB Bank for raising Additional Tier-I (AT-l) capital through issuance of Perpetual Bonds of Tk 600 Crore.

Of the Tk 600 Crore, Tk 540 Crore will be issued through private placement and the remaining Tk 60 Crore under the public offering, as per the BSEC approval.

According to the BSEC directive, if an issuer intends to raise debt capital through issuance of perpetual bond, it will make a public offer for at least 10 per cent of its intended offer and must be listed on the bourses.

The bond is transferable, unsecured, non-cumulative, contingent- convertible and floating rate perpetual bond. The coupon rate will be 6.0 per cent to 10 per cent.

Local merchant bank, MTB Capital Ltd is acting as the trustee of the bond, while Riverstone Capital Ltd is working as issue manager and arranger. BMSL Investments Ltd is working as the underwriter of the bond.

Each share of the bank, which was listed on the DSE in 1983, closed at Tk 10.50 on Sunday, losing 0.94 per cent. Its shares traded between Tk 10.40 and Tk 10.70 in the last one year.

The bank’s paid-up capital is Tk 835 Crore and authorised capital is Tk 150 Crore, while the total number of securities is 83 Crore.