This PSU Bank Announces Redemption of Rs 3,000 Cr Tier-2 Bonds, Key Dates Released; What Chart Pattern Hints?

Bank of India (BOI) has announced the redemption of its Basel III-compliant Tier 2 bond (ISIN: INE084A08060) with an issued amount of Rs 3,000 crore, slated for maturity on 31 December 2025. The bank has set December 16, 2025, as the record date to determine eligible bondholders in compliance with SEBI standards.

"The trading in the above-mentioned bond will be suspended between the Record Date and the Redemption Date. Upon payment of broken period interest and bond principal amount by the Bank on its due date to the holders of the Bond as on the Record Date, the Bank's liability to the Bondholders towards all their rights including for the payment or otherwise shall cease and stand extinguished," said Bank of India (BOI) in a stock exchange filing.

Last month, Bank of India announced that ICRA Ltd. had assigned a [ICRA] AA+ (Stable) rating to its newly issued Basel-III compliant Tier II bonds worth Rs 2,500 crore, while also reaffirming and subsequently withdrawing the rating for its fixed deposit program, as no deposits remained mobilised under ICRA's rating.

The rating notes the bank's solid capital position, improving solvency levels, and steady drop in stressed assets, supported by its majority sovereign ownership of 73.38% and the Government of India's track record of capital injections. The bank's credit profile is strengthened by its capital buffers, retail-driven granular deposit base, competitive cost of funds, and CASA ratio of 39.24%, according to ICRA.

Asset quality has improved, with GNPA falling to 2.54% and NNPA to 0.65% as of September 30, 2025, though the vulnerable book remains a monitorable factor, as per ICRA.

Profitability continues to improve, with BoI reporting a 0.91% annualised RoA in H1 FY2026, driven by better operating performance. With an LCR of 119.76% and an NSFR of 113.88%, much above regulatory standards, liquidity is still high. According to ICRA, a drop in asset quality, solvency, or sovereign ownership might be a negative trigger, whereas significant growth, improved profitability, and ongoing capital strength would be vital for an upward rating movement.

In contrast to a net profit of Rs. 4,076 crore in H1 FY2025 on a total asset base of Rs. 9.78 lakh crore as of September 30, 2024, BoI recorded a net profit of Rs. 4,807 crore in H1 FY2026 on a total asset base of Rs. 10.69 lakh crore as of September 30, 2025. Bank of India (BoI) was formed in 1906 and was nationalised, along with 13 other banks, in July 1969.

The GoI's stake in the bank was 73.38% as of September 30, 2025. As to ICRA's projections, BoI had a market share of 3.6% and 3.7%, respectively, in the total advances and deposits of the Indian banking industry as of September 30, 2025 and an extensive network of 5,399 branches across India.

BOI Target Price

"BOI is sustaining above key moving averages and forming a steady higher-low structure, indicating continued bullish sentiment. The ₹142-145 zone acts as strong support, where buyers consistently step in. Momentum is stable, and a close above ₹150 can trigger fresh upside. If sustained, the rally may extend towards ₹155-158. Trend remains positive unless ₹142 breaks," commented Riyank Arora, technical analyst at Mehta Equities Ltd.

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