Al-Arafah Islami Bank has received approval to raise Tk 500 crore by issuing a non-convertible, floating and mudaraba subordinated bond.

The Bangladesh Securities and Exchange Commission (BSEC) approved the bond yesterday at a meeting held at the BSEC building in Dhaka.

Institutional investors, high-net-worth people can buy the bond through private placement. The price of each unit of the bond would be Tk 5 lakh.

With the bond proceeds, the bank will strengthen its Tier-2 capital base. The bond has to be listed on the alternative trading board of the security exchanges.

Its trustee is First Security Islami Capital & Investment and mandated lead arrangers are UCB Investment and Prime Bank Investment.