Dutch-Bangla Bank, a leading Bangladeshi lender, is gearing up to raise Tk 12 billion in fresh capital through a private bond sale.

This move aims to strengthen its financial base and comply with regulatory requirements under Basel-III guidelines.

The bank’s board approved the plan, subject to regulatory approvals from Bangladesh Bank and the Securities and Exchange Commission. The seven-year bonds will rank as subordinated debt, meaning they will be repaid after senior creditors in case of financial distress.

This capital injection strengthens the Dutch-Bangla Bank’s Tier 2 capital under Basel-III, which includes reserves, provisions, and certain debt instruments. This tier plays a crucial role in absorbing losses and protecting senior creditors.

The bonds will be fully redeemable, unsecured, and non-convertible to equity. They offer investors a fixed rate of return over the seven-year term.