Two major state-owned banks, Bank of Baroda and Canara Bank, are planning to raise funds through infrastructure bonds, targeting amounts of Rs 10,000 crore and Rs 5,000 crore, respectively. 

Bank of Baroda is expected to conduct its Rs 10,000 crore infrastructure bond issuance towards the end of November, with a focus on issuing 10-year bonds. 

The bank announced its decision to issue infrastructure bonds in two tranches, with the first tranche amounting to Rs 5,000 crore. This initial offering comprises a base issue of Rs 1,000 crore, supplemented by a green shoe option of up to Rs 4,000 crore.

Canara Bank’s infrastructure bonds, also with a 10-year maturity, are scheduled for bidding on Thursday. The bonds have received ‘AAA’ ratings from CARE Ratings and India Ratings.

The initial issue size is Rs 1,000 crore, with a green shoe option worth Rs 4,000 crore, bringing the total aggregate issuance to Rs 5,000 crore. 

Infrastructure bonds serve as crucial financial instruments for various entities in India, including governments, banks, and authorised infrastructure companies. They play a pivotal role in funding diverse developmental projects across the nation.