HDFC Bank Makes Green Debut, Raising $300 Million via Sustainable Bond

7 Feb 2024 , 06:38 AM

With the launch of its first sustainable finance bond offering denominated in US dollars, India’s HDFC Bank has raised $300 million, the lender announced in a statement on Wednesday.

The largest private lender in the nation based on market capitalization set a yield of 5.196% on its three-year sustainability bond. The difference is 95 basis points (bps) over the three-year U.S. Treasury yield, which is significantly less than the 125 bps that was first predicted.

According to Arup Rakshit, group head of treasury at HDFC Bank, ‘lending towards electric vehicles, small and medium enterprises, and affordable housing will be prioritised for the funds raised through the sustainable finance bonds.’

Additionally, the bank has raised an additional $450 million by selling senior unsecured dollar bonds with a 5.180% rate. These notes were priced at 108 basis points below the five-year U.S. yield, which was also less than the 140 basis point initial projection.

The lender stated that the money raised from the sale of the five-year notes will be utilised for general corporate objectives, as well as for the financing and growth of the bank’s overseas subsidiaries and branches.

Moody’s and S&P will rate the Regulation-S dollar notes at Baa3 and BBB–, respectively.

The Gujarat International Finance Tech City branch of the bank will issue the notes, which will also be listed on the India International Exchange.

As lead managers and joint worldwide coordinators, Barclays, Bank of America, JP Morgan, MUFG, and Standard Chartered are involved.

For feedback and suggestions, write to us at [e-mail]