RRBs are allowed to issue PDI

The Reserve Bank of India vide. Circular No. DOR.RRB.No.21/31.01.001/2019-20 dated November 1, 2019, permitted RRBs (Regional Rural Banks) to issue Perpetual Debt Instruments (PDI) eligible for inclusion as Tier 1 capital so as to maintain prescribed CRAR. The Perpetual Debt Instruments (PDI) is issued by way of bonds or debentures in Indian Rupees only. The RRBs should meet the following terms and conditions to qualify for inclusion as Tier 1 and Tier 2 Capital for capital adequacy purposes. The Tier 1 Common Equity Capital (CET1) of the bank are Paid up share capital, share capital deposit, Statutory and other disclosed free reserves, Capital Reserve representing surplus arising out of sale proceeds of assets, any surplus (net) in profit and loss account i.e. balance after appropriation. In addition to above, the amount raised through the Perpetual Debt Instruments issued by the bank are included with Tier 1, & Tier 2 capital provided total Tier 1 capital should not be less than 7 per cent of risk-weighted assets after the regulatory adjustment / deduction such as amount of intangible assets, losses in current year and those brought forward from previous years, deficit in NPA provisions, income wrongly recognized on non-performing assets, provision required for liability devolved on bank, net amount of DTA and DTL, etc. The amount raised through the Perpetual Debt Instruments will be limited to 1.5 percent of the total risk-weighted assets of the bank. The amount raised over and above 1.5 percent may also be included in Tier 1 capital subject to bank complies with the minimum Tier 1 capital of 7 percent of risk-weighted assets before reckoning such additional amounts.
The retail investors/FPI/NRIs/other Banks including RRBs are not eligible to subscribe to PDI issued by RRBs.