homemarket NewsBank of Baroda to raise up to $7 billion via Bonds & Certificate of Deposits

Bank of Baroda to raise up to $7 billion via Bonds & Certificate of Deposits

The public sector lender will raise foreign currency fund through issuance of bonds up to USD 1 billion under the bank’s MTN programme and through issuance of Certificate of Deposits (CDs) up to USD 3 billion under CD programme in single or multiple tranches at appropriate time.

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By Jitesh Jha  Apr 21, 2023 5:20:13 PM IST (Published)

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Bank of Baroda to raise up to $7 billion via Bonds & Certificate of Deposits
State-run Bank of Baroda on Friday said that its board has approved raising of foreign currency fund. The public sector lender will raise foreign currency fund through issuance of bonds up to $1 billion under the bank’s MTN programme and through issuance of Certificate of Deposits (CDs) up to $3 billion under CD programme in single or multiple tranches at appropriate time.

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In addition, the Bank of Baroda also said that its board has also approved raising of funds through bilateral/other borrowings up to USD 3 Billion.
A medium-term note (MTN) is a note that usually matures in five to 10 years. They are offered by a company to investors through a dealer in which the investors can choose from differing maturities that ranges from nine months to 30 years. Most MTNs range in maturity from one to 10 years.
While Certificate of Deposit (CD) is a savings product and it earns interest on a lump sum for a fixed period of time. This deposit is different from savings product because in this case the money should remain untouched for the entirety of their term or risk penalty fees or lost interest. CDs have higher interest rates than savings accounts.
The bank on April 12, 2023, revised its lending rates (Marginal Cost of Funds Based Lending Rate (MCLR)) with ‘overnight’ rate raised from 7.9 percent to 7.95 percent, and the ‘One Year’ rate increased to 8.6 percent from 8.55 percent.
Bank of Baroda revised its Marginal Cost of Funds Based Lending Rate (MCLR) from April 12, 2023, with ‘overnight’ rate raised from 7.9 percent to 7.95 percent, and the one year rate increased to 8.6 percent from 8.55 percent.
The public bank’s total Business surpassed the Rs 21 trillion milestone as of March 31, 2023, growing by 16.8 percent YoY to Rs 21.77 trillion.
Bank of Baroda’s global gross advances grew by 19 percent YoY to Rs 9.73 lakh crore from Rs 8.18 lakh crore in the fourth quarter ended March 31, 2023. Its domestic advances also grew by 16.9 percent to Rs 7.99 lakh crore YoY against Rs 6.84 crore. The bank’s total deposits grew 15.1 percent YoY to Rs 12.03 lakh crore against Rs 10.45 lakh crore. Its domestic deposits also saw a growth of 13 percent YoY to Rs 10.47 lakh crore against Rs 9.27 lakh crore.
The bank’s total business grew by 16.8 percent YoY to Rs 21.77 lakh crore against Rs 18.64 lakh crore in Q4FY23.
Shares of Bank of Baroda were trading 1.49 percent lower at Rs 175.10 per share at 1:20 pm on NSE.

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