AU Small Finance Bank Raises Rs 770 Cr via Tier-II Bond

New Delhi, Mar 28 (PTI) AU Small Finance Bank (AU SFB) on Friday said it has raised Rs 770 crore through Tier-II bonds to fund business growth.

The bonds with 10-year maturity carry a coupon rate of 9.20 per cent per annum, AU Small Finance Bank said in a statement.

The current capital raise is expected to increase the capital adequacy ratio of the bank by about 1 per cent, it said.

Overall, the bank remains well capitalised and had an overall capital adequacy ratio of 19.9 per cent at the end of the third quarter of FY25, including interim profits for nine months of FY25, it said.

With this fund raise, it said, the bank has achieved one of the largest bond issuances by any small finance bank amidst adverse market conditions exacerbated by a tight liquidity environment with deal closing on the last working day of 2024-25.

The Jaipur-based lender had last raised capital in August 2022 for a total of Rs 2,500 crore comprising of Tier I capital of Rs 2,000 crore and Tier II capital of Rs 500 crore.