Israel Discount Bank raises $177 million in notes

TEL AVIV, July 14 (Reuters) - Israel Discount Bank (DSCT.TA), the country's third-biggest bank, said on Tuesday it had raised 702 million shekels ($177 million) in upper tier II capital.

This brings to 1.15 billion shekels the amount in upper tier II capital the bank has raised since April.

The capital notes are linked to the consumer price index and bear annual interest of 6.35 percent.

In the first quarter of 2009 Discount raised 350 million shekels in hybrid tier I capital.

The issues are aimed at boosting the bank's capital adequacy ratio. Israeli banks are required by regulators to raise their capital adequacy ratios to 12 percent by the end of 2009.

Discount's ratio was 10.42 percent at the end of the first quarter.

The Bronfman Group, which controls Discount, said last week it would present a plan by the end of the month detailing how the bank would meet regulators' demands on its capital adequacy requirement. ($1 = 3.96 shekels) (Reporting by Tova Cohen, editing by Will Waterman)