Mumbai, Aug 6 (IANS): Bank of Baroda, the second largest state-owned bank, is planning to raise Rs 1,000 crore through issuance of infrastructure and affordable housing bonds on August 12, a source close to the development told IANS.

"The likely tenure for the bonds is seven years and have Rs 250 crore as base issue and Rs 750 crore as greenshoe," the source said.

The auction for the infrastructure and affordable housing bonds is expected to be held on August 12 on the BSE's bidding platform.

During the bidding, better coupon is expected to set on the bonds considering the higher demand for PSU bonds.

The bonds have got 'AAA' ratings with 'Stable' outlook from ICRA and India Ratings and Research.

On June 27, the board of directors of the bank has approved raising Rs 5,000 crore through Long term Bonds for financing of infrastructure and affordable housing.

The source said Rs 5,000 crore is expected to raise by the bank in tranches.

Whereas, on July 16, the investment committee of the bank approved raising Rs 1,000 crore through this bonds.