Indian Bank has successfully completed the full redemption of its Basel III Compliant AT1 Bonds Series IV, exercising the call option on December 30, 2025. The bank disclosed this development under Regulation 57 of SEBI (LODR) Regulations, 2015, confirming the payment of both principal and interest on the debt securities.

Bond Redemption Details

The bank redeemed the entire issue through call option exercise, with the following key parameters:

The bonds were originally issued as perpetual instruments, but the bank chose to exercise its call option for full redemption on the specified date.

Interest Payment Completion

Simultaneously with the redemption, Indian Bank paid the annual interest on these AT1 bonds as scheduled:

Regulatory Compliance

The bank confirmed that both interest and redemption payments were made on the due date without any delays. This transaction represents the complete closure of the Basel III Compliant AT1 Bonds Series IV, with no remaining outstanding obligations to bondholders.

The redemption through call option exercise demonstrates the bank's proactive debt management strategy, allowing it to retire the perpetual bonds at its discretion. The timely completion of both interest payment and principal redemption reflects the bank's commitment to honoring its debt obligations as per the original terms and conditions.

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.