Issue of Debt

2 Oct 2006 07:00

UTI Bank Limited30 September 2006 September 30, 2006 ALLOTMENT OF UNSECURED REDEEMABLE NON-CONVERTIBE TIER I DEBENTURES ON PRIVATE PLACEMENT BASIS AS THE BANK'S TIER I CAPITAL We are pleased to inform that the Board of Directors of the Bank have passed aresolution approving Allotment of Unsecured Redeemable Non-ConvertibleDebentures to various investors on private placement basis as the Bank's Tier Icapital aggregating to Rs. 214 crores. The Debentures are issued as per termsheet enclosed. The Debentures will be listed on The Bombay Stock Exchange (BSE) and TheNational Stock Exchange (NSE) in India. TERM SHEET 22nd September, 2006 Issue of Unsecured Subordinated Bonds in the nature of Debentures aggregating Rs214 crores, for inclusion as tier I capital on the following terms: Name of the Issuer UTI Bank Ltd. Amount to be raised Rs. 214 crores. Face Value Rs. 10,00,000 (Rupees Ten Lakhs) per Debenture Issue price Rs.10,00,000 per Debenture (at par) Security Unsecured Redeemable Non Convertible Tier I Debenture Rating 'LAA' by ICRA and'AA (ind)' by FITCH Coupon Rate upto 10 years 10.05% p.a. Coupon Payment Semi-annually Coupon payment Dates Subject to RBI Guidelines issued in this regard, Interest would be paid semi-annually on September 30th and March 31st and on Call Option date if call option is exercised by Bank. Maturity Perpetual Call Option The Bank shall have an option for redemption "i.e. Call Option" to redeem the Bonds at par at the end of 10th Year from the Deemed Date of Allotment i.e 30th September, 2016 and on every interest payment date and thereafter (exercisable only with RBI approval) Step up of coupon 100 bps over and above coupon rate of 10.05% semi-annual i.e. 11.05% semi-annual from September 30, 2016, if the Bank does not exercise the call option. Day Count basis Interest payable on the Debentures will be calculated on the basis of actual number of days elapsed in a year of 365 or 366 Days as the case may be Interest on Application Money Interest on application money will be same as the Coupon rate (subject to deduction of Tax at Source at the rate prevailing from time to time under the provisions of the Income Tax Act, 1961 or any other statutory modifications or re-enactment thereof) will be paid on application money to the applicants from the date of realisation but excluding the Deemed Date of Allotment. Listing The Debentures being offered shall be listed on Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Ltd. (NSE). Minimum Application Size 1 Debenture and in multiples of 1 Debenture thereafter Market Lot 1 and in multiples of 1 thereafter Debenture Trustees The Western India Trustee & Executor Co. Limited Registrar & Transfer Agents Karvy Computershare Pvt. Ltd. Arrangers Allianz Securities ltd., Citibank, N.A, Darashaw & Company (P) Ltd. Issue Schedule Issue Opening Date(*) September 25, 2006 Issue Closing Date (*) September 29, 2006 Deemed Date of Allotment (*) September 30, 2006 (*) The issuer reserves the right to change the issue timetable including theDeemed Date of Allotment at its sole discretion, without giving any reasons orprior notice. Disclosures: Disclosures: These Bonds are issued in terms of RBI circular no. DBOD.No.BP.BC.57/21.01.2002/2005 2006 dated January 25, 2006, on enhancement of banks' capital-raisingoptions covering norms for raising of instruments eligible for inclusion underTier-I capital. Interest on the securities will not be cumulative and interest which is not paidwill not accumulate or compound from Interest Period to Interest Period. Thismeans that, if interest is not paid on the securities on any Interest PaymentDate, holders of the securities will have no right to receive those interestpayments at any time thereafter, even if interest payments are made in thefuture. If and to the extent that, on any Interest Payment Date, UTI Bank has: • a Capital Deficiency (as defined below), then UTI Bank shall not pay any interest on such date; or • a Net Loss (as defined below) or increase in Net Loss without a Capital Deficiency, then UTI Bank shall not pay any interest on such date without the prior approval of the Reserve Bank of India ("RBI"). "Capital Deficiency" means, for any Interest Payment Date, that UTI Bankdetermines that its Capital to risk assets ratio ("CRAR") has declined below theminimum regulatory requirement prescribed by the RBI from time to time, (i) asat the immediately preceding March 31 in the case of the Interest Payment Datein April and (ii) as at the immediately preceding September 30 in the case ofthe Interest Payment Date in October. "Net Loss" means, for any Interest Payment Date a determination made by UTIBank as per (a) unconsolidated Indian GAAP financial statements that it haseither (i) a negative balance reported in the balance in the profit and lossaccount line item in its Balance Sheet, or (ii) a net loss reported in itsprofit and loss account, as at and for the 12 month period ended on theimmediately preceding March 31 in the case of the Interest Payment Date in Marchor as at and for the six month period ended on the immediately precedingSeptember 30 in the case of the Interest Payment Date in September or (b)regulations or guidelines prescribed by Reserve Bank of India from time to timein this regard. In case of any conflict between the determination made under (a)and (b) hereinabove, the determination made under (b) shall prevail. This information is provided by RNS The company news service from the London Stock Exchange