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ICICI Bank today raised Chinese yuan 650 million (around $106 million) through three-year Regulation S (Reg S) bonds. According to issue arrangers, the bonds were subscribed 1.5 times. This was the first Chinese yuan bond issue from India in 2013.
Reg S bonds are offered to non-US residents and qualified institutional buyers under an exception to US securities laws enacted in 1990, and do not enjoy the same legal protection as other issues. The bonds were raised at a coupon rate of four per cent. The bonds are a part of the bank’s $5-billion global Medium Term Notes programme.
Standard Chartered Bank and HSBC were arrangers to the issue. Last November, the bank had raised 500 million yuan at a coupon rate of 4.66 per cent by way of bonds maturing in 2015. Those bonds were a re-opening of an earlier issue of yuan-denominated bonds and had taken the total size of the issue to 1 billion yuan. In January, the bank had raised Singapore dollar 225 million from a seven-year bond sale programme through its Dubai branch at a coupon rate of 3.65 per cent. According to issue arrangers, the bank had gone for Chinese Yuan bonds because it was cheaper compared with dollar-denominated bonds.
Standard & Poor’s (S&P) Ratings Services assigned ‘BBB-’ long-term issue rating to the issue (foreign currency BBB-/Negative/A-3). According to S&P, the rating on the notes reflect long-term counter-party credit rating on the bank.
Moody’s Investors Service assigned Baa2 rating to the issue. The bonds will be listed on the Singapore Stock Exchange and the rating carries stable outlook.
