United Commercial Bank (UCB) will issue a non-convertible, unsecured, fully redeemable subordinated bond worth Tk 1,000 crore.

In a meeting last night, Bangladesh Securities and Exchange Commission approved the bond, which will have floating rate.

The tenure of the bond is seven years and its rate ranges from 6 to 9 per cent.

The face value of each unit of the bond is Tk 1 core.

The fund would be raised through private placement from financial institutions, insurance companies, institutional investors, corporate, and high net-worth individual investors.

With the bond proceeds, the lender would invest in traditional business and strengthen its tier 2 capital base.

DBH Finance Corporation is the trustee of the bond and it would be listed with the alternative trading boards of Dhaka and Chittagong stock exchanges.