With an issue of non-convertible subordinated perpetual bonds - tier I (series II), Canara Bank is looking at mobilizing Rs 600 crore, including a greenshoe option of Rs 200 crore which would be used to build up the bank''s capital adequacy and also improve its long-term resources. In addition, the bonds will have a call option that may be exercised after the instrument has run for at least 10 years and with approval from the RBI. Moreover, the bonds coupon rate would be 9.10% per annum for the first 10 years, followed by a step-up option to boost the coupon rate to 9.6%, if the call option has not been exercised by the bank at the end of the tenth year from the deemed date of allotment.
FM assures fresh capital for RRBs
Finance Minister Pranab Mukherjee stated that in order to increase credit flow to the farm sector, the government will introduce fresh capital into the regional rural banking (RRB) system to make it profitable by 2010 and this in turn would help RRBs achieve their agriculture targets in 2009-10. Additionally, he said that it will set up a committee to look into the demands of the rural banks, including fresh capital infusion. However, he said that there will be no fresh proposal for farm loan waver and that the economy will grow at over 6% in the current fiscal.
FM assures fresh capital for RRBs
Finance Minister Pranab Mukherjee stated that in order to increase credit flow to the farm sector, the government will introduce fresh capital into the regional rural banking (RRB) system to make it profitable by 2010 and this in turn would help RRBs achieve their agriculture targets in 2009-10. Additionally, he said that it will set up a committee to look into the demands of the rural banks, including fresh capital infusion. However, he said that there will be no fresh proposal for farm loan waver and that the economy will grow at over 6% in the current fiscal.
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