Indian Bank has received the requisite prior approval from the Reserve Bank of India to exercise the call option on its outstanding Tier 2 Bonds Series V, completing a crucial regulatory milestone for the public sector bank. The approval enables the bank to proceed with the call option exercise on bonds aggregating to ₹2000.00 crores, scheduled for January 13, 2026.

RBI Approval and Regulatory Compliance

The bank announced the receipt of RBI approval through its official communication dated December 29, 2025, in continuation to its earlier letter dated December 18, 2025. This approval fulfills the regulatory requirement that was previously mentioned as a condition for the call option exercise. The approval demonstrates the bank's adherence to Basel III compliance framework and regulatory oversight requirements.

Bond Details and Timeline

The call option exercise involves the bank's Basel III compliant Tier 2 Bonds Series V, which were originally issued in January 2021. The following table outlines the comprehensive details of the bond series:

Corporate Action Implementation

With the RBI approval now secured, Indian Bank can proceed with the call option exercise as scheduled. The record date of December 29, 2025, has been established to determine eligible bondholders for the call option exercise. This date serves as the cut-off for identifying bondholders who will be affected by the corporate action.

Capital Structure Management

The Tier 2 Bonds Series V represent a significant component of the bank's supplementary capital under Basel III guidelines. The successful completion of this call option exercise will allow Indian Bank to optimize its capital structure and manage its regulatory capital requirements effectively. The bonds carry a coupon rate of 6.18%, reflecting the interest rate environment at the time of their original issuance.

The bank has maintained transparency throughout this process by providing regular updates to stock exchanges in compliance with SEBI LODR Regulations, 2015, ensuring proper disclosure to all stakeholders and market participants.

Indian Bank , a prominent public sector bank, has announced significant changes to its lending rates, effective December 3, 2025. The bank's Asset Liability Management Committee (ALCO) has revised both the Marginal Cost of funds based Lending Rate (MCLR) and Treasury Bills Linked Lending Rates (TBLR) across various tenors.

Key Changes in Lending Rates

The revisions in MCLR and TBLR rates are as follows:

It's worth noting that the Base Rate, Benchmark Prime Lending Rate (BPLR), Policy Repo Rate, and Repo Linked Benchmark Lending Rates (RBLR) remain unchanged.

Impact on Borrowers

These rate adjustments are likely to affect both new and existing borrowers with floating rate loans linked to MCLR or TBLR. The changes may influence EMIs for various loan products offered by Indian Bank.

Bank's Financial Position

While the bank adjusts its lending rates, it's important to consider its overall financial health. As per the latest available balance sheet data:

The bank has shown growth across key financial metrics, indicating a strong financial position as it implements these rate changes.

Conclusion

Indian Bank's decision to revise its MCLR and TBLR rates reflects its response to the current economic environment and monetary policies. Borrowers are advised to review their loan agreements and consult with the bank to understand how these changes may affect their financial obligations.