Indian Overseas Bank (IOB) plans to raise Rs 800 crore through perpetual bonds in three months. Back on December 8, the bank’s board of directors approved a plan to raise Rs 800 crore through Tier-I (perpetual bonds). However, the bank delayed the plan due to changes introduced by the Reserve Bank of India in the implementation of Basel-III norms.
The Reserve Bank of India (RBI) has rescheduled the start date for implementation of Basel III, the global capital norms for banks, by three months to April 1, 2013 from January 1, 2013. The norms are to be implemented in a phased manner by March 31, 2018.
Further, in case, the bank raises funds through perpetual bonds, along with the proposed preferential share capital to be raised from the government, its Tier-I capital would increase to more than 8% by the end of the current financial year.
