Skip to main content
Last modified on Saturday, 07 August 2021 00:00

BRAC's Tk 1,350 crore bond gets MRA approval Featured

Rate this item
(0 votes)

BRAC's Tk 1,350 crore bond gets MRA approval

BRAC, the largest microcredit provider in Bangladesh, has received approval from Microcredit Regulatory Authority (MRA) to issue zero-coupon bonds valued BDT 1,350 crore through private placement. Issuance of zero coupon bond by a non-governmental organisation is the first of its kind in microcredit history of Bangladesh.

Executive vice chairman of MRA Md Fashiullah handed over the much anticipated approval letter to Tushar Bhowmik, chief financial officer of BRAC, in a small ceremony arranged by MRA on its own premises on Thursday (5 August) afternoon.

MRA executive director Laxman Chandra Debnath, directors Muhammad Mazedul Haque and Md Nure Alom Mahadi and BRAC associate director Ashit Baran Das were also present at the ceremony.

Earlier on February 3, Bangladesh Securities and Exchange Commission (BSEC) also approved the issuance of this zero-coupon bonds valued Tk1,350 crore.

The bond is unsecured, non-convertible, and fully redeemable with its tenure from one and a half years to five years. Institutional investors, corporates and high net worth individuals will be eligible to purchase this bond with a multiple of BDT 10 million. RSA Advisory Limited is acting as a lead arranger of this issue and MTB Capital Limited is acting as trustee to the issue.

“Client’s savings and bank borrowings was the main source of funds for BRAC Microfinance. Now Bond issuance also comes as an alternative source of funding for the microcredit institutions,” BRAC CFO Tushar Bhowmik said.

The CFO expected that the bonds would open up avenues for non-lender institutions to invest in BRAC's microfinance programme. He commented that it is a great recognition for the microfinance sector and expressed gratitude to all regulatory bodies for the cooperation along the way.

BRAC expects that the bonds will help improve the livelihoods of people who need access to affordable financial solutions, especially in marginalised communities, in a more efficient way.

BRAC’s journey began in Sulla, in northeast Bangladesh in 1972. Having access to finance was necessary for people living in poverty to break the cycle. Understanding their need, the first loans given by BRAC were in 1974 to fishermen in Sulla. Till date, BRAC microfinance programme has reached 7.4 million clients with financial services.

Read 1020 times

Join the world’s biggest family

sign-up

Subscribe

STAY INFORMED. Subscribe to our newsletter.

Top