India lenders' dollar debt sales top $10 billion since RBI window, ICICI Bank beats peer to lead pack

ICICI Bank, India's second-largest private lender, is tapping the U.S. dollar-denominated bond market for the fourth time in a month, under the central bank's discounted window, which will push overall issuances by banks above $10 billion.

ICICI Bank is planning to raise $1 billion through private placement of five-year bonds at a coupon of ‌5.41%, two ⁠merchant bankers said, ⁠requesting anonymity as they are not authorised to speak to media.

The private bank did ​not reply to Reuters' query seeking comment.


The latest placement will take the aggregate funds ​raised by ICICI Bank under the Reserve Bank of India's discounted window to $3.05 billion, leading the charts.

It has also helped ICICI Bank overtake HDFC, the ​country's largest private-sector bank, which has raised an ⁠aggregate of $2.50 ‌billion so far.

Towards the end of July, ICICI ​Bank raised $1 ​billion through a five-year paper at 100 basis points over ⁠Treasuries, with a 5.46% coupon, and that was its ​first issuance in nearly nine years.

In early August, the lender ​reissued these papers at a yield of 5.3520%, raising $300 million, while last week it raised $750 million through five-year papers at a spread of 105 basis points over Treasuries at a 5.4170% coupon.

The sale further extends a wave of offshore fundraising by Indian lenders after the central bank ‌opened a concessional swap window for foreign-currency deposits, with total proceeds from bond issuances at $10.3 billion.

Banks have been able to ​raise cheaper funds ​since the window was ⁠announced on June 5, giving them rupee liquidity that can support lending and investment and help margins.

In the last few days, banks have been ​scrambling to complete their dollar issuances, with most funds being used to provide leverage to customers who will be depositing these funds under the discounted dollar deposit scheme.

Earlier this month, the RBI said the window provided to banks for hedging non-resident deposits would end a month early on August 31.