Indian Bank , a prominent public sector bank, has successfully completed the redemption of its Additional Tier 1 (AT1) Bond Series III worth Rs 560 crore following the exercise of call options. The bank had previously received approval from the Reserve Bank of India (RBI) to exercise call options on three series of AT1 bonds totaling Rs 2,000 crore.

Payment Confirmation Details

On December 12, 2025, Indian Bank confirmed the completion of principal and interest payments for its Basel III Compliant AT1 Bond Series III under SEBI (LODR) Regulations, 2015. The payment details are as follows:

Timing Adjustment for Business Days

The original due date for the call option exercise was December 14, 2025. However, since this fell on a Sunday (holiday) and December 13, 2025 was a non-business day in Mumbai's money market, the payment was made on the immediately preceding business day, December 12, 2025, as per the terms of the offer document.

Complete AT1 Bond Portfolio Overview

The bank had received RBI approval for call options on three series of AT1 bonds with the following structure:

Regulatory Compliance and Transparency

As mandated under Regulation 57 of SEBI (LODR) Regulations, 2015, Indian Bank has formally disclosed the completion of this redemption payment to both NSE and BSE. This regulatory filing ensures complete transparency for all market participants and bondholders regarding the bank's debt securities management.

Capital Structure Impact

The successful redemption of AT1 Bond Series III represents a significant step in Indian Bank's capital management strategy. This move allows the bank to optimize its Tier 1 capital structure while maintaining regulatory compliance and demonstrates proactive financial management in the current market environment.

Indian Bank shares continued their rally on Monday, climbing over 3% and marking the sixth consecutive day of gains. This surge has propelled the stock's year-to-date returns to 70%, showcasing the bank's strong performance in the current market.

Stellar Long-term Performance

The public sector bank has delivered exceptional returns to its investors over the past five years:

Q2 FY2024 Financial Highlights

Indian Bank's September quarter results demonstrated growth:

The bank also reported improved asset quality, with both gross and net non-performing assets (NPAs) showing a decline.

Potential Index Inclusion

The recent rally in PSU bank stocks, including Indian Bank, may be attributed to SEBI's draft proposals indicating changes to non-benchmark index weightage. These changes could improve prospects for inclusion in the Nifty Bank index.

Nuvama Alternative has identified Indian Bank as one of four potential candidates for banking index inclusion, which might result in significant inflows:

Analyst Recommendations

The stock has garnered attention from analysts:

Current Stock Performance

As of the latest trading session:

Indian Bank's performance and potential index inclusion have positioned it as an option for investors considering the Indian banking sector. However, as with all investments, it's crucial to conduct thorough research and consider individual risk tolerance before making investment decisions.