Meghna Bank PLC has received approval from the Bangladesh Securities and Exchange Commission (BSEC) to issue a Tk 400 crore subordinated bond to strengthen its capital base.

The approval was granted at the BSEC’s 1,026th commission meeting held on Tuesday, chaired by BSEC Chairman Masud Khan. The regulator disclosed the decision in a press release signed by its Executive Director and spokesperson, Md Abul Kalam.

The proposed bond will have a seven-year maturity and will be non-convertible, unsecured, fully redeemable, coupon-bearing and floating-rate in nature. Its coupon rate will be determined by adding a 3 percent margin to the applicable reference rate.

The bond will be issued through private placement to eligible investors, including corporate entities, high-net-worth individuals, banks and financial institutions, provident and pension funds, and insurance companies.

Each unit of the bond will have a face value of Tk 5 lakh.

According to the BSEC, proceeds from the bond issuance will help strengthen Meghna Bank’s Tier-2 capital under the Basel III framework, enhancing the bank’s capital position.

DBH Finance PLC will serve as the trustee of the bond, while BRAC EPL Investments Limited will act as the issue manager.