Amid monetary tightening, businesses in Bangladesh are increasingly issuing zero-coupon bonds to raise funds. In the first five months of 2023, eight companies received approval to collect over Tk 42 billion through these bonds, which defer interest payments. Additionally, Rupali Bank, Shahjalal Islami Bank, and Southeast Bank were permitted to raise Tk 20 billion via subordinated and perpetual bonds.
Companies prefer zero-coupon bonds to manage repayment burdens, despite their high costs and 15% coupon rates. Beximco aims to raise Tk 15 billion through zero-coupon bonds, offering a 15% discount rate, with funds allocated for the Mayanagar project and bank loan repayments. Renata issued Tk 6.60 billion in zero-coupon bonds to repay high-cost bank credits. These bonds attract investors by offering higher returns than risk-free government securities.
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