October 16, 2018 / 1:47 PM / a year ago

UPDATE 1-Russia's VTB to issue 20 bln roubles worth of subordinated bonds

(Adds VTB comment in the third paragraph)

MOSCOW, Oct 16 (Reuters) - Russia’s second largest lender VTB said on Tuesday it will issue perpetual subordinated bonds worth 20 billion roubles ($305 million).

The bank has approved the placement of the bonds, which will carry semiannual coupons. They will not have a maturity date and VTB reserves the right to redeem the bonds, it said in a statement filed via the Moscow stock exchange.

VTB told Reuters that the new bond placement is a part of the group’s general capital management process, without elaborating.

Subordinated bonds can be included in the bank’s capital - the cushion essential to issue loans and make acquisitions. (Reporting by Tatyana Voronova; Writing by Andrey Kuzmin; Editing by Susan Fenton and Robin Pomeroy)

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