Bank of Baroda has received regulatory approval from the Reserve Bank of India to establish a fully-owned subsidiary for conducting standalone primary dealer business. This development marks a significant step in the bank's strategy to expand its treasury and government securities operations.

Regulatory Approval and Capital Structure

The RBI has granted permission for the establishment of this specialized subsidiary, which will operate as an independent primary dealer entity. The approval comes with specific regulatory framework requirements that the bank must adhere to for successful implementation.

Capital Infusion Plan

Bank of Baroda has committed to infuse capital of up to ₹2000 crores into the new subsidiary. This substantial capital commitment demonstrates the bank's confidence in the primary dealer business segment and its potential for growth. The capital infusion will be executed under certain conditions as specified by the regulatory framework.

Strategic Implications

The establishment of a dedicated primary dealer subsidiary will enable Bank of Baroda to participate more actively in government securities markets. Primary dealers play a crucial role in the government securities market by underwriting government debt issuances and providing liquidity in secondary market trading.

This move positions the bank to leverage opportunities in the government securities segment while maintaining operational focus through a specialized entity. The subsidiary structure will allow for dedicated resources and expertise development in primary dealer operations.

Bank of Baroda 's Board of Directors has approved a significant fund-raising initiative worth up to Rs 15,000 crores through long-term bonds. The approval was granted during a board meeting held on January 30, 2026, marking a strategic move to strengthen the bank's capital base for infrastructure and affordable housing financing.

Board Meeting Details

The board meeting was conducted on January 30, 2026, with proceedings spanning from 10:30 a.m. to 4:30 p.m. During this session, directors deliberated and approved the comprehensive bond issuance plan that will support the bank's lending operations in key sectors.

Fund Raising Structure

The approved bond issue demonstrates a well-structured approach to capital mobilization:

Bond Specifications and Timeline

The long-term bonds will specifically target financing for infrastructure projects and affordable housing initiatives. The issue includes provisions for Long Term Green Infrastructure Bonds, reflecting the bank's commitment to sustainable financing solutions.

Key features of the bond issue include:

• Execution Method: Single or multiple tranches based on market conditions
• Timeline: FY 2025-26 and beyond
• Feasibility: Subject to market conditions and regulatory approvals
• Regulatory Compliance: Issued under Regulation 30 of SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015

Strategic Implications

This fund-raising initiative positions Bank of Baroda to expand its lending portfolio in critical sectors of the Indian economy. The focus on infrastructure and affordable housing aligns with national development priorities and provides the bank with opportunities to participate in long-term growth sectors.

The inclusion of green infrastructure bonds also demonstrates the bank's alignment with environmental, social, and governance (ESG) principles, potentially attracting ESG-focused institutional investors.

Regulatory Disclosure

The bank has fulfilled its disclosure obligations under SEBI regulations, with Company Secretary S Balakumar signing the official communication to stock exchanges. The disclosure references previous communications dated January 19, 2026, and January 23, 2026, indicating ongoing coordination with regulatory authorities regarding this fund-raising initiative.