ICICI Bank mulls first benchmark dollar bond sale since 2017

Synopsis

ICICI Bank is planning its first benchmark US dollar bond sale since 2017, aiming to raise at least $500 million through offshore bonds. The proposed issuance comes after the RBI introduced a concessional foreign exchange swap facility, encouraging Indian lenders to tap overseas markets for funding.

ICICI Bank Ltd., India’s second-largest private-sector lender, is in talks to raise at least $500 million in offshore bonds as it seeks to capitalise on a recent Reserve Bank of India concession for overseas borrowings, according to people familiar with the matter.

The lender is preparing to raise the overseas funds in the coming weeks under the so-called Global Medium-Term Note program, a dedicated debt issuance route, said the people who asked not to be identified because discussions are private.

The proposed transaction would mark ICICI Bank’s first benchmark-sized US dollar bond sale under the facility since it raised $500 million in 2017, according to data compiled by Bloomberg. The lender is talking to a group of global banks, who are arranging the proposed deal, said the people.

ICICI Bank did not reply to Bloomberg’s email seeking comment.

The planned offering follows the RBI’s announcement last month of a concessional foreign-exchange swap facility for eligible overseas borrowings, part of the central bank’s efforts to attract global capital and support the rupee.

Several lenders have lined up plans to raise foreign funds, with HDFC Bank garnering funds worth $750 million last month through a debt sale. Axis Bank, State Bank of India and Power Finance Corp have also accessed the international market, according to data compiled by Bloomberg.

The RBI’s steps have helped to arrest the sharp decline in the rupee that was triggered by the energy shock from the US-Iran war. The currency has gained nearly 2% since hitting a record low of almost 97 to a dollar in late May.

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