Karnataka Bank raises Rs 250 crores by issue of debentures

Mangalore based The Karnataka Bank Ltd, a premier private sector bank has raised Rs 250 crore by issue of Non-Convertible Subordinated Debt instruments in the nature of Debenture (Lower Tier 2 Bonds) on private placement basis.

The issue of Bonds with a tenor of 10 years was opened for subscription on October 22, 2012 and closed on November 12, 2012. Rs 125 crore issue with a right to retain oversubscription to the extent of Rs.125 crore received huge response from the investors resulting in the oversubscription by 100%.

The Bank Capital to Risk weighted Assets Ratio (CRAR) as on March 31, 2012 was 12.84 % consisting of Tier 1 capital of 10.86% and Tier 2 of 1.98%. With the above issue of Bonds, the capital funds of the Bank have further improved which will enable the Bank to further expand the credit portfolio in the coming days.