ICICI Bank raises $88 million via Japanese `Pro-bonds'

MUMBAI: ICICI Bank, India's largest private lender, has raised 10 billion Japanese yen ($88 million) by selling a new series of bonds known as pro-bonds, the first issue of its kind by an Indian company.

The bank's committee of executive directors, at its meeting held on Friday , approved the proposed borrowing plan for the remaining period of 2016-17, ICICI Bank said in a statement to stock exchanges.

Japan-based pro-bonds, which came into existence in 2008, target professional investors and are aimed at developing Japan's bond market. The bonds will mature in five years and offer 0.678% fixed rate, the bank said in the statement.

Through this route, Japanese institutional investors, who are facing negative interest rates, can earn higher rates.

Bank of Tokyo-Mitsubishi UFJ Ltd & HSBC were the arrangers for the sale.

“The bank acting through its DIFC (Dubai) branch, priced an issuance of 5-year fixed rate notes for an aggregate principal amount of JPY 10 billion under the bank's Tokyo Pro-Bond Programme, which is listed in Tokyo Stock Exchange,“ the bank said.

The issue was rated as BBB-, the lowest in the investment grade in line with India's sovereign rating.

“Usually, this market is not accessible to BBBrated names but this time it will be different, with investors chasing higher yields,“ said an investment banker, who did not wish to be identified.