visimoney
TLDR:
HDFC Bank, India’s biggest private lender, has raised $300 million through its inaugural sustainable finance bond issue. The three-year sustainability bond was priced at a yield of 5.196%, 95 basis points lower than the initial guidance. The funds raised will be used for lending towards electric vehicles, small and medium enterprises, and affordable housing. Additionally, the bank has raised $450 million through senior unsecured five-year dollar bonds, with proceeds to be used for general corporate purposes and the expansion of foreign branches and subsidiaries.
Key points:
- HDFC Bank raises $300 million through its debut sustainable finance bond issue.
- The three-year sustainability bond was priced at a yield of 5.196%, 95 basis points lower than the initial guidance.
- Funds raised will be used for lending towards electric vehicles, small and medium enterprises, and affordable housing.
- The bank also raises $450 million through senior unsecured five-year dollar bonds.
- Proceeds from the five-year notes will be used for general corporate purposes and the expansion of foreign branches and subsidiaries.
HDFC Bank, India’s largest private lender, has successfully raised $300 million through its first-ever sustainable finance bond issue. The bank priced its three-year sustainability bond at a yield of 5.196%, which is 95 basis points lower than the initial guidance of 125 basis points. The funds raised through this bond will be primarily used for lending towards electric vehicles, small and medium enterprises, and affordable housing, according to Arup Rakshit, the group head of treasury at HDFC Bank.
In addition to the sustainable finance bond, HDFC Bank also raised $450 million through senior unsecured five-year dollar bonds. These bonds were priced at a coupon of 5.180%, with a spread of 108 basis points over the five-year US Treasury yield. The proceeds from this bond offering will be used for general corporate purposes and the expansion of the bank’s foreign branches and subsidiaries.
The Regulation-S dollar notes issued by HDFC Bank will be rated Baa3 by Moody’s and BBB– by S&P Ratings. The bonds will be listed on the India International Exchange and will be issued by the bank’s Gujarat International Finance Tech City branch. Barclays, Bank of America, JP Morgan, MUFG, and Standard Chartered are acting as joint global coordinators and lead managers for the bond issue.
This successful bond issue demonstrates HDFC Bank’s commitment to sustainable finance and responsible lending. By issuing sustainable finance bonds, the bank is able to attract investors who are specifically interested in supporting environmentally-friendly and socially responsible initiatives. The funds raised will contribute to the bank’s efforts in promoting electric vehicles, supporting small and medium enterprises, and providing affordable housing options.
