(MENAFN- KNN India)
New Delhi, Sep 14 (KNN)
In a significant financial move, state-run Indian bank successfully raised Rs 5,000 crore through the issuance of long-term infrastructure bonds.
The private placement saw an overwhelming response, attracting a total of 88 bids amounting to Rs 13,680 crore-2.74 times the issue size.
The bank initially set a base issue of Rs 2,000 crore with a greenshoe option to retain an oversubscription of up to Rs 3,000 crore, leading to a total issue size of Rs 5,000 crore.
The bids were accepted at a coupon rate of 7.24 per cent per annum, a competitive rate given the prevailing market conditions. The issuance highlights strong market confidence in the bank's creditworthiness, especially as the bonds have been rated AAA with a stable outlook by both CRISIL and CARE.
The bonds, which have a fixed maturity period of 10 years, are senior, rated, listed, unsecured, redeemable, long-term, fully paid-up non-convertible bonds.
They are exempt from regulatory requirements such as maintaining the Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CRR), which makes them an attractive investment tool for financing infrastructure projects.
The funds raised will be strategically used by Indian Bank to support its credit growth and refinancing of infrastructure projects-a key focus area in India's economic development.
Given the bank's established history and stable performance, the market's strong response underscores investor confidence in the bank's future direction and the nation's growing infrastructure demands.
The allotment of these bonds took place on Friday, and the issuance marks another step in Indian Bank's commitment to mobilising resources efficiently to fuel India's infrastructure sector, essential for the nation's long-term growth trajectory.
This successful issuance reflects Indian Bank's proactive approach to resource management and positions it well to meet future capital requirements.
(KNN Bureau)
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