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In a key capital mobilization milestone aimed at strengthening its regulatory balance sheet and supporting sustainable credit expansion, ONE Bank PLC secured formal regulatory approval on Wednesday to float a subordinated bond worth Tk 400 crore, with capital market disclosures detailing the approval on Thursday (October 1). The regulatory sanction was approved during a formal commission meeting of the Bangladesh Securities and Exchange Commission (BSEC) in Dhaka. The debt instrument is structured as a non-convertible, unsecured, fully redeemable, floating-rate subordinated bond. The proceeds will be channeled directly into fortifying the bank's Tier-II regulatory capital base in strict compliance with Basel III guidelines.
Under the terms approved by the capital market regulator, the Tk 400 crore debt instrument will be issued entirely through private placement to institutional investors, high-net-worth individuals, and corporate entities. The issue price will be set at par value, featuring semi-annual profit coupon disbursements linked to prevailing benchmark treasury yields plus a designated credit risk margin. BSEC officials confirmed that the debt securities will be listed on the alternative trading board of the country's twin bourses in Dhaka and Chattogram. The structured capitalization ensures that ONE Bank maintains a robust Capital to Risk-Weighted Assets Ratio (CRAR).
Commercial banking analysts observed that issuing subordinated debt represents an essential capital management strategy for private banks operating under stringent post-reforms regulatory scrutiny. In recent quarters, Bangladesh Bank has mandated strict enforcement of Basel III risk-weighted capital adequacy buffers across all scheduled commercial banks to safeguard depositor assets against macro shocks. By securing Tk 400 crore in Tier-II capital, ONE Bank expands its single-borrower exposure ceilings, allowing the institution to finance major industrial syndications, renewable energy projects, and small-and-medium enterprise (SME) development programs. Capital adequacy remains a primary regulatory priority across the banking system.
Managing Director and Chief Executive Officer of ONE Bank PLC expressed profound appreciation to the securities commission and the central bank for their prompt regulatory clearance. The managing director affirmed that the successful issuance will enhance the bank's financial resilience, optimize its liquidity buffers, and provide substantial long-term funding for productive private sector enterprises. He noted that the bank's core operational metrics—including asset quality, digital banking penetration, and non-funded fee income—have demonstrated steady improvement over the past three fiscal quarters. The management reiterated its focus on sound corporate governance and financial stability.
The mandated merchant banker and issue manager confirmed that formal private placement subscription procedures will commence across accredited institutional investors within the next thirty days. Market observers noted that despite macroeconomic headwinds and banking liquidity constraints, well-governed subordinated bonds from established private commercial lenders continue to attract solid demand from sovereign pension funds, insurance corporations, and mutual fund managers seeking predictable yield. The capital enhancement solidifies ONE Bank's competitive standing within Bangladesh's commercial financial ecosystem. The capital expansion positions the bank for sustained long-term growth.
