Canara Bank To Raise ₹4,500 Crore Through AT-1 Bonds Next Week
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Canara Bank plans to raise up to ₹4,500 crore through Basel III-compliant AT-1 bonds on 16 September, as part of a larger ₹8,500 crore capital-raising plan that also includes Tier 2 bonds.
State-owned Canara Bank Ltd. plans to raise up to ₹4,500 crore through Basel III-compliant Additional Tier 1 (AT-1) bonds next week. The bank’s board has also approved raising up to ₹4,000 crore through Tier 2 bonds, taking the total capital-raising plan to ₹8,500 Cr.
The AT-1 issue comes as Canara Bank continues to expand its deposits and advances across multiple sectors.
Ahead of the announcement, the Canara Bank share price closed at ₹124.18, up 0.081% on 10 September 2026.
What Are the Key Terms of Canara Bank’s AT-1 Bond Issue?
Canara Bank will offer perpetual debt instruments under the proposed AT-1 issue. These bonds will carry a call option after five years, subject to regulatory clearance.
The proposed issue is scheduled through the NSE’s Electronic Bidding Platform (EBP) on 16 September from 12:00 p.m. to 1:00 p.m., with the expected coupon rate in the 7.85%-7.90% range.
The proposed AT-1 bonds have received the following ratings:
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ICRA Ratings: AA+; Stable
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India Ratings: AA+; Stable
Why Is Canara Bank Raising Capital Now?
Canara Bank is currently on track to achieve a business size of ₹30 lakh crore, with continued growth in deposits and advances supporting its operations.
The bank’s lending and deposit operations span four key segments:
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Retail
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Agriculture
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MSME
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Corporate
Canara Bank has also reported strong liability mobilisation. Its recent deposit mobilisation includes funds raised through the FCNR(B) swap facility announced by the Reserve Bank of India. Through the facility, the bank has mobilised $5.80 billion.
How Will The Capital Raise Support Canara Bank?
The proposed AT-1 issuance is intended to strengthen Canara Bank’s capital position and provide additional headroom to support business growth. The bank also said the capital raising will help it maintain a strong capital base and financial resilience.
The AT-1 securities will be perpetual, with the five-year call option subject to regulatory clearance. The separate Tier 2 component is part of the same board-approved capital-raising programme.
Canara Bank’s proposed fundraising therefore combines AT-1 and Tier 2 instruments, with the two components together accounting for up to ₹8,500 crore.
Also Read - Vodafone Idea Set To Receive $3.5 Billion Funding From SBI-Led Group
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
When she's not decoding markets, she trades charts for canvases, chasing art, painting, and architecture across cities she's yet to explore.
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