Mumbai: Bank of Maharashtra is planning to invest up to ₹50 crore in tier-I perpetual bonds to be issued by a regional rural bank that it sponsors, according to two people aware of the development.
Maharashtra Gramin Bank is planning to raise a total of ₹70 crore through issuance of tier-I perpetual bonds. This, according to bond market participants, is as rare as the issuer is a regional rural bank, jointly owned by Bank of Maharashtra (35%) along with the Centre (50%) and the Maharashtra government (15%). “Of the issue size, sponsor bank is expected to pick up ₹50 crore and the rest will be raised from the market.
The bond issue is likely to be closed before the end of March,” said the first person. Bank of Maharashtra didn’t reply to email seeking comments. Bonds are expected to be priced at 10.15% rate. Maharashtra Gramin Bank had last issued tier-I perpetual bonds in December 2021.