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HDFC Bank has raised USD 1.75 billion through senior unsecured bonds issued through its GIFT City branch to support the bank’s business growth. The fundraising comprises USD 500 million of three-year notes carrying a 5.159% coupon and USD 1.25 billion of five-year notes with a 5.4% coupon. The bonds will be listed on India International Exchange (India INX) and NSE International Exchange (NSE-IX). The transaction provides the private sector lender with additional overseas funding capacity as it expands its banking operations
HDFC Bank has raised USD 1.75 billion through an overseas bond issue to fund its business growth, with the transaction completed through the lender’s GIFT City branch, the bank said in a regulatory filing on August 21. The fundraising comprises two tranches of senior unsecured bonds with different maturities. HDFC Bank raised USD 500 million through three-year notes carrying a coupon rate of 5.159%, while the remaining USD 1.25 billion was raised through five-year notes carrying a 5.4% coupon.
The issue was undertaken by HDFC Bank through its branch in GIFT City, Gujarat, which serves as the lender’s International Financial Services Centre (IFSC) banking unit. The fundraising forms part of the bank’s efforts to secure capital from international markets for supporting its business expansion.
The bonds are structured as senior unsecured debt securities, meaning they are not backed by specific collateral and rank as senior obligations of the issuing bank. The two tranches provide the lender with funding across different maturity periods. The USD 500 million three-year notes will mature after three years, while the larger USD 1.25 billion tranche will have a five-year maturity. The different tenures allow the bank to diversify the maturity profile of the funds raised through the transaction.
The securities will be listed on India International Exchange (IFSC) Limited (India INX) and NSE International Exchange (NSE-IX). Both exchanges operate from GIFT City, India’s International Financial Services Centre. The transaction adds to the growing role of GIFT City in facilitating international financial transactions by Indian banks and financial institutions. Banks operating through IFSC units can access international capital markets and undertake a range of cross-border financial activities.
For HDFC Bank, the latest bond issue provides USD-denominated funding that can be deployed towards its broader business requirements. The bank has not indicated in the regulatory filing any specific project or business segment to which the proceeds will be allocated beyond supporting business growth.
The fundraising also gives the lender access to longer-term overseas debt, with the five-year tranche accounting for the majority of the amount raised. The three-year and five-year securities together constitute the bank’s latest international bond fundraising.
The transaction comes as Indian banks continue to use domestic and international debt markets to diversify their funding sources. Overseas bond issues can provide access to international investors and foreign-currency funding, while listings on IFSC-based exchanges provide an Indian market platform for such securities. With the completion of the issue, HDFC Bank has secured USD 1.75 billion in additional funding, comprising USD 500 million in three-year notes and USD 1.25 billion in five-year notes, with the securities scheduled for listing on India INX and NSE-IX.
Source PTI
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