The Bank of Maharashtra is planning to invest up to ₹50 crore in tier-I perpetual bonds issued by Maharashtra Gramin Bank, a regional rural bank that it partially sponsors. This is a rare event, as regional rural banks are rarely issuers of bonds. Maharashtra Gramin Bank, which is jointly owned by Bank of Maharashtra (35%), the Centre (50%), and the Maharashtra government (15%), plans to raise a total of ₹70 crore through the issuance of tier-I perpetual bonds. The sponsor bank, Bank of Maharashtra, is expected to acquire ₹50 crore of the issue, with the remaining ₹20 crore being raised from the market. The bond issue is anticipated to be closed by the end of March. The bonds are expected to be priced at 10.15%, and this is not the first time Maharashtra Gramin Bank has issued tier-I perpetual bonds, having done so in December 2021.
Bank of Maharashtra Agrees to Acquire a Stake in RRB’s Tier-I Bonds
