NIBL’s 8% debenture and 40 lakh units of FPO in the offing

Mon, May 19, 2014 12:00 AM on Others, Bonds & Debentures,

ShareSansar, May 19:

Nepal Investment Bank Limited (NIBL) is planning to float a redeemable debenture of Rs 75 crore at 8 percent biannual interest rate within a month or two.

An official with the commercial bank informed that they have applied for the issuance of the bond with Securities Board of Nepal (SEBON) on April 28, and expect to float the debenture by Ashad end.

“The debenture will be floated at 8 percent interest rate to be paid every six months and the maturity period will be seven years,” a highly placed source at NIBL Capital told ShareSansar today.

NIBL had issued similar debenture of Rs 50 crore in July last year at 8 percent interest and with a par value of Rs 1,000 and a maturity period of 5 years.

This year, however, Nepal SBI Bank and NIC Asia Bank have issued debetures so far.

On March end, Nepal SBI Bank Limited had issued '7.9 percent debenture 2080’ worth Rs 20 crore at a face value Rs 1000 per unit. Its maturity period is ten years.

Earlier this month NIC Asia Bank issued a debenture worth Rs 50 crore at 7.25 per cent interest rate.

The ‘7.5% NIC Asia bond 2077’ was floated at the face value of Rs 1,000 per unit on May 4.

The maturity period of the redeemable bond was six years.

It may be noted that though SEBON’s website has also posted the date of application of the NIBL's debenture on its website, it has mistakenly placed it under the status of IPO in the pipeline.

The NIBL official further informed that the bank is also planning to issue FPO of 40 lakh units to the general public in future.

“The FPO is aimed at maintaining the public share in the bank at 30 percent as directed by the central bank, up from the existing 20 percent,” the official further said, adding that the FPO is likely to be issued in a premium price.