India Ratings & Research (Ind-Ra) has assigned Bank of Baroda's (BOB) Rs 10 billion non-convertible redeemable, unsecured Basel III compliant Tier 2 bonds a long-term 'IND AAA' rating.

The bond rating has been equated to BoB's Long-term Issuer Rating because of the bank's strong stand-alone credit profile.

BoB's Basel III Tier 2 instruments are payable annually with a coupon rate of 9.03% and are redeemable after 10 years on Dec. 17, 2023. The claims of bondholders are senior to the claims of investors in the instruments eligible for inclusion in Tier 1 capital, but subordinate to the claims of all depositors and general creditors of the bank. The bonds are subject to loss absorbency features, and at the option of the Reserve Bank of India can be temporarily written down or permanently written off upon occurrence of the 'point of non-viability trigger'.

Shares of the bank declined Rs 17.7, or 3.33%, to trade at Rs 513.75. The total volume of shares traded was 334,169 at the BSE (3.26 p.m., Thursday).