Allahabad Bank raises Rs 600 cr through bonds

State-owned Allahabad Bank today said it has raised Rs 600 crore through private placement of bonds.

The lender has on date successfully raised Additional Tier I (AT-1) capital of bank through private placement of AT 1 perpetual bonds Series III aggregating to Rs 600 crore, Allahabad Bank said in a regulatory filing on stock exchanges.

The bond carries an annual coupon of 9.34 per cent, it said.

Under the Basel-III norms, AT-1 bonds come with loss absorbency features, meaning that in case of stress, banks can write off such investments or convert them into common equity if approved by the RBI.
 

AT-1 bonds, which qualify as core or equity capital, are one of the means of raising capital by banks.