Five banks get BSEC nod for Tk3,500cr bonds

Five banks have received regulatory approval to raise a combined Tk3,500 crore from the capital market through bond issuance.

The Bangladesh Securities and Exchange Commission (BSEC) approved bond proposals from One Bank, Southeast Bank, BRAC Bank, Al-Arafah Islami Bank and Bank Asia at its 1031st commission meeting.

At the same meeting, the BSEC also granted no-objection to the formation of a nine-member board of directors of Beximco Pharmaceuticals PLC, considering the interests of investors.

The meeting was chaired by BSEC Chairman Masud Khan, according to a press release issued by BSEC Executive Director and Spokesperson Abul Kalam.

Five banks to issue bonds

The commission approved One Bank PLC’s Tk400 crore unsecured, non-convertible, fully redeemable, floating-rate Subordinated Bond-VI.

The bond will carry a coupon rate of the reference rate plus three percentage points and will be issued through private placement to institutional and high-net-worth individual investors. Each unit will have a face value of Tk1 lakh.

The proceeds will be used to strengthen the bank’s Tier-2 capital base under Basel III. Green Delta Capital Limited will serve as trustee and UCB Investment Limited as issue manager. The bond must be listed on the main board of the stock exchanges.

BSEC also approved Southeast Bank PLC’s Tk800 crore seven-year, fully redeemable, non-convertible, unsecured, floating-rate Southeast Bank Subordinated Bond (6th Issue).

The bond will carry a coupon rate of the reference rate plus three percentage points and will be issued through private placement to institutional and high-net-worth investors. Each unit will have a face value of Tk5 lakh.

The proceeds will be used to strengthen the bank’s Tier-2 capital. DBH Finance PLC will serve as trustee and UCB Investment Limited as issue manager. The bond must be listed on the main board.

BRAC Bank PLC received approval for a Tk1,000 crore three-year unsecured, non-convertible, fully redeemable, zero-coupon green bond, with an expected discount rate of 8.5%.

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The bond will be issued through private placement to banks and financial institutions, private funds, grant funds, high-net-worth individuals and other eligible investors. Each unit will have a face value of Tk10 lakh.

The proceeds will be used to provide low-cost green financing to eligible customers. Prime Bank Investment PLC will serve as trustee and IDLC Investments Limited as issue manager. The bond must be listed on the main board.

The commission also approved Al-Arafah Islami Bank PLC’s Tk500 crore seven-year unsecured, non-convertible, redeemable, floating-rate AIBPLC 5th Subordinated Bond.

The bond will carry a coupon rate of the reference rate plus three percentage points and will be issued through private placement to institutional and high-net-worth investors. Each unit will have a face value of Tk5 lakh.

The proceeds will be used to strengthen the bank’s Tier-2 capital. DBH Finance PLC will serve as trustee and UCB Investment Limited as issue manager.

Bank Asia PLC received approval for a Tk800 crore seven-year unsecured, non-convertible, fully redeemable, floating-rate sustainable subordinated bond.

The bond will carry a coupon rate of the reference rate plus three percentage points and will be issued through private placement to institutional, high-net-worth and other eligible investors. Each unit will have a face value of Tk10 lakh.

The proceeds will be used to strengthen the bank’s Tier-2 capital and finance or refinance eligible sustainable projects. DBH Finance PLC will serve as trustee and Prime Bank Investment PLC as issue manager. The bond must be listed on the main board.

BSEC clears proposed Beximco Pharma board

At the same meeting, BSEC granted no-objection to the proposed formation of a nine-member board of directors of Beximco Pharmaceuticals PLC.

The approval came in light of a letter from the commission’s panel advocate and verbal directions from the court, with BSEC citing the need to protect investors’ interests in responding to the company’s application.

The proposed board will include three sponsor directors – ASF Rahman, Osman Kaiser Chowdhury and Iqbal Ahmed – along with a newly appointed managing director.

IFIC Bank PLC, a local financial institution, will nominate one director.

The board will also include four independent directors, three of whom will be newly appointed. At least one of the four independent directors must be a woman, in compliance with the Corporate Governance Code, 2018.

The commission also decided to withdraw two earlier orders concerning the company, subject to Beximco Pharmaceuticals withdrawing its lawsuit.