In a bid to boost its tier II capital for business growth, public sector lender Bank of India is planning to raise around Rs 1,500 crore through Basel III compliant bonds. These bonds carry a feature called 'Point of non-viability (PONV)' trigger. Occurrence of such event results in loss of principal amount to investors and default on the instrument.
Rating agency CRISIL has assigned ‘AAA/Stable’ rating to Tier II bonds issue. The rating agency has also reaffirmed its ratings on the bank’s existing debt instruments at ‘CRISIL AAA/Stable/CRISIL A1+’.
The ratings continue to reflect expectation of strong support from the Government of India (GoI), the bank’s majority shareholder, both on an ongoing basis and in the event of any distress.
Rating agency CRISIL has assigned ‘AAA/Stable’ rating to Tier II bonds issue. The rating agency has also reaffirmed its ratings on the bank’s existing debt instruments at ‘CRISIL AAA/Stable/CRISIL A1+’.
The ratings continue to reflect expectation of strong support from the Government of India (GoI), the bank’s majority shareholder, both on an ongoing basis and in the event of any distress.
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