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The Financial Express

Subscription of two perpetual bonds opens tomorrow

| Updated: November 23, 2021 18:31:18


Subscription of two perpetual bonds opens tomorrow

Two new mudaraba perpetual bonds -- IBBL 2nd Mudaraba Perpetual Bond and SJIBL Mudaraba Perpetual Bond -- will open for public subscription tomorrow (Sunday).

The subscription through the electronic subscription system of the stock exchanges will continue until December 02, according to Dhaka Stock Exchange (DSE).

The Islami Bank Bangladesh Limited (IBBL) has issued the "IBBL 2nd Mudaraba Perpetual Bond" to raise Tk 8.0 billion while Shahjalal Islami Bank Limited issued the "SJIBL Mudaraba Perpetual Bond" to raise Tk 5.0 billion.

A perpetual bond is a fixed income security with no maturity date and is often considered as a type of equity rather than debt. These types of bonds are not redeemable but provide a never-ending stream of interest payments instead.

The minimum subscription amount is Tk 5,000 and there is no maximum bar for both bonds.

Islami Bank: Bangladesh Securities and Exchange Commission (BSEC) on September 5 this year accorded its consent to Islami Bank for raising a total of Tk 8.0 billion through the IBBL 2nd Mudaraba Perpetual Bond as additional Tier- I capital of the bank.

The bond will be subordinated, contingent-convertible, fully paid-up, floating rate, coupon/profit discretion, non-cumulative.

Of Tk 8.0 billion, Tk 7.20 billion will be raised through private placement and the remaining Tk 800 million through public offering in compliance with the BSEC public offering rules.

Islami Bank, the listed private commercial bank, will strengthen its additional Tier-1 capital base with the collected money.

Local institutional investors such as non-banking financial institutions, insurers, banks, and asset management firms and high-net-worth individuals can buy the bond units through a private placement.

SBL Capital Management is acting as the trustee of the bond, while Prime Bank Investment and UCB Investment are working as issue manager.

Each share of Islami Bank Bangladesh, listed on the DSE in 1985, closed at Tk 32.70 on Thursday. Its shares traded between Tk 25.40 and Tk 33.70 in the last one year.

Shahjalal Bank: The stock market regulator on September 5 this year accorded its consent to Shahjalal Bank for raising a total of Tk 5.0 billion through SJIBL Mudaraba Perpetual Bond as additional Tire-1 capital of the bank.

Of Tk 5.0 billion, Tk 4.50 billion will be raised through private placement and the remaining Tk 500 million through public offering in compliance with the BSEC public offering rules.

The purpose of the issue is to strengthen the capital base of the bank.

The coupon rate of the bond will be 6.0 per cent to 10 per cent of the bond.

Local institutional investors such as non-banking financial institutions, insurers, banks, and asset management firms and high-net-worth individuals can buy the bond units through a private placement.

MTB Capital Ltd is acting as the trustee of the bond, while two other investment banks -- Islami Bank Capital Management and UCB Investment -- are working as issue manager.

Each share of Shahjalal Islami Bank, listed on the DSE in 2007, closed at Tk 22.80 on Thursday. Its shares traded between Tk 19.40 and Tk 23.90 in the last one year.

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