The Industrial Development Bank of India (IDBI) has raised a five-year syndicated term loan facility of $75 million with bullet repayments. The loan was priced at 90 basis points over the London inter-bank offered rate.
"In spite of the difficult market conditions due to the recent tension between India and Pakistan, we could raise the loan at such a fine rate. The money will be used for on-lending in dollars to corporates," said an IDBI official.
Citibank/Salomon Smith Barney was the co-ordinating arranger of the deal, together with Arab Banking Corporation (BSC) and Bank of Baroda, which joined the deal as co-ordinating arrangers. Bumiputra-Commerce Bank Berhad, London branch, joined the syndication as an arranger and Union National Bank joined as a lead manager.
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The issue had opened on April 15 and closed on May 14. IDBI had managed to borrow at this rate despite it being downgraded last year by credit rating agencies.
Fitch had in December 2001 downgraded the long and medium term bonds, fixed deposits, certificate of deposits ratings of IDBI from 'Ind AAA' to 'Ind AA+'.
Crisil had in July 2001 downgraded IDBI. The IDBI Flexibond issue is rated AA+ by Crisil and LAA+ by Icra.
IDBI has also managed to raise Rs 250 crore through its private placement of Omni-bond issue which closed on May 14. It is also due to come with a Flexiboond issue of Rs 250 crore with a greenshoe option of the same amount.