ICICI Bank, Axis Bank Return to Dollar Debt Market With $300 Million Each
ICICI Bank and Axis Bank are raising $300 million each via dollar bonds, their second offshore debt sale in under two months.
Two of India's largest private sector lenders are returning to the international dollar debt market for the second time in less than two months, with each bank raising $300 million, according to merchant bankers familiar with the matter.
ICICI Bank is issuing five-year bonds carrying a semi-annual coupon of 5.3520%. Axis Bank, meanwhile, is raising its funds by reopening its existing 5.3480% bonds due June 2031, which will bring the total outstanding under that issuance to $600 million.
Both placements are being done privately and are scheduled to close for subscription next week. The notes will be listed on the India International Exchange IFSC and NSE IFSC.
The latest issuances follow larger offshore fundraising by both lenders. Last month, ICICI Bank raised $1 billion through five-year bonds at a 5.46% coupon — the biggest such dollar bond sale by an Indian lender in nearly 14 years. In June, Axis Bank raised $800 million through a dual-tranche deal that included the initial sale of the five-year papers and $500 million of perpetual notes carrying a 6.875% annual coupon, payable semi-annually.
The bonds are being issued under the Reserve Bank of India's lower-cost hedging facility, which allows eligible external commercial borrowings by banks and state-owned companies to be hedged at a fixed rate of 1.5% per annum, compounded semi-annually. This mechanism reduces the overall cost of borrowing for issuers.