Bank of India has raised ₹5,000 crore through the issuance of infrastructure bonds, with the state-owned lender receiving bids far in excess of the notified amount for the debt sale.
On Thursday, Bank of India sold 10-year infrastructure bonds for a total of ₹5,000 crore at a rate of interest of 7.54%, the lender informed exchanges.
The bond issuance, which had a base size of ₹2,000 crore and a greenshoe option of ₹3,000 crore, received 127 bids worth ₹15,318 crore, the bank said.
“The funds raised through long-term bonds will be used for funding long-term projects in infrastructure sub-sectors and affordable housing in accordance with RBI guidelines. The funds raised by the Bank through this issue are not meant for financing any particular project,” the bank said.Funds raised through infrastructure bonds are exempt from maintenance of the cash reserve ratio and Statutory Liquidity Ratio, helping banks manage their interest costs more deftly.
