IDFC FIRST Bank raises Rs1,500cr via private placement of tier-2 bonds

9 Feb 2022 , 01:06 PM

IDFC FIRST Bank has raised Rs1,500cr through private placement of Unsecured, Subordinated, Rated, Listed, Non-Convertible, Fully Paid-Up, Taxable, Redeemable Basel III Compliant Tier 2 Bonds (in the nature of Debentures) for a face value of Rs1cr each.

The Bonds shall be redeemed in accordance with the terms of issue on its original maturity of 10 years, however, a Call Option may be exercised at the sole discretion of the Bank after completion of 5 years from the date of allotment and yearly thereafter, and subject to fulfilment of extant regulatory provisions.

The subscription participation came from marquee domestic investors including Life Insurance Corporation of India which subscribed to more than 60% of the issue size.

On this occasion, Sudhanshu Jain, CFO and Head — Corporate Center, said, “We are delighted as this is the maiden Tier-2 issuance of bonds by the Bank since its inception. The initial issue size was of Rs1,000cr with a Green Shoe Option to retain oversubscription up to Rs500cr.

I’m happy to say that the issue was oversubscribed to the maximum level by the marquee domestic investors including the Life Insurance Corporation of India (LIC) and this showcases the strong interest for our paper in the market. With this Tier-2 capital raise, the capital adequacy would be enhanced to 16.5% (calculated on the financials as of 31st December 2021). We see strong credit demand in our business lines and such capital will help to boost our overall growth prospects.”

At around 1:09 PM, IDFC First Bank was trading at Rs46.90 apiece up by Rs0.15 or 0.32% on the BSE.