Union Bank of India successfully raised **USD 500 million** through its first-ever dollar-denominated Additional Tier 1 (AT1) bond issuance, which was oversubscribed by 7.8 times. This significant fundraising effort listed at diversifies the bank's funding sources and strengthens its capital base.
$500 million
Amount Raised
⏳ Time Machine
How today’s news fits into the bigger picture
2013
Basel III norms introduced globally
norms for capital adequacy are introduced globally, requiring banks to hold higher and better-quality capital, including instruments like AT1 bonds.
2015-2017
Indian banks explore AT1 bonds domestically
Indian banks, particularly PSBs, begin exploring various capital-raising avenues, including AT1 bonds in domestic markets, to meet new regulatory capital requirements.
2020
GIFT City push as global financial hub
India's government intensifies efforts to establish as an international financial services hub, encouraging Indian entities to list and raise capital there.
Mid-2020s
Improved financial health of PSBs
Indian public sector banks show improving asset quality and financial health, making them more attractive to international investors for debt issuances.
Today
Union Bank of India successfully raised USD 500 million through its first-ever dollar-denominated Additional Tier 1 (AT1) bond issuance, which was oversubscribed by 7.8 times.
What happens next?
The capital raised will be deployed by Union Bank to support credit growth and strengthen its capital base, with impacts on its balance sheet expected in upcoming quarterly results.
Union Bank of India has marked a significant milestone by successfully raising **USD 500 million** through its inaugural dollar-denominated Additional Tier 1 (AT1) bond issuance. The offering saw overwhelming demand, being oversubscribed by a remarkable **7.8 times**, indicating strong investor confidence in the public sector bank. These bonds, which contribute to a bank's capital reserves, have been listed at Gujarat International Finance Tec-City (GIFT City), India's international financial services hub. This strategic move not only diversifies Union Bank's funding sources but also enhances its capital adequacy, preparing it for future growth and regulatory requirements.
💭 If you're wondering…
AT1 bonds are a type of perpetual debt instrument issued by banks to fulfill their capital requirements under Basel III norms. They can be written down or converted to equity if the bank's capital falls below a certain threshold.
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