Guwahati: HDFC Bank Limited announced that it has raised $ 300 million through its first ever sustainable finance bond issue.
This is part of an overall raise of $ 750 million through Regulation S Bonds. While $ 300 million has been raised for a tenure of three years with a 95 basis points spread over US Treasury, another $ 450 million has been raised for a tenure of 5 years, with a spread of 108 basis points over US Treasury.
These are the tightest credit spreads achieved by an Indian issuer for a three-year sustainable bond and five-year senior unsecured bond for a similar size of USD Regulation S issuance.
Regulation S provides an SEC-compliant way for non-US and US companies to raise capital outside the U.S. It is not necessary to have a company in the United States of America to use Regulation S.
A Regulation S offering can issue equity or debt securities.
The proceeds of the sustainable finance bond will be utilised for funding green and social loans in accordance with the sustainable finance while the rest of the proceeds will go towards financing general banking activities.
”The funds raised through the sustainable finance bonds will be prioritised for lending towards electric vehicles, SMEs and affordable housing. We are strongly committed towards building a green and social portfolio even as we continue adhering to the Bank’s risk philosophy, ” Arup Rakshit, Group Head-Treasury, HDFC Bank, said.
The bonds will be listed on India International Exchange (India INX) in GIFT IFSC. The paper was rated Baa3 (stable) by Moody’s and BBB- (stable) by S&P. The bank had mandated Barclays, BofA Securities, J.P. Morgan, MUFG and Standard Chartered Bank as Joint Global Coordinators and Joint Lead Managers.
