The overseas debt raising by domestic companies has picked up again with country's third largest private sector lender Axis Bank today raising USD 500 million in a 5.5-year dollar-money at 3.25 per cent coupon payment.
The city-based bank claimed that at 3.25 per cent fixed rate coupon, this is the lowest ever paid by an issuer in this tenor for senior unsecured notes. The bonds are due 2020 and were issued by the Dubai branch. They will be listed on the Singapore Exchange.
The notes have been rated Baa2 by Moody's, BBB- by S&P and BBB- by Fitch, the bank said.
Axis Bank said the offering got over-subscription of more than four times with strong support from investors in Asia, Europe and the non-resident Americans.
Barclays, Credit Agricole CIB, HSBC, JP Morgan and Standard Chartered acted as joint book-runners and lead managers to the transaction, the bank said.
On the pricing front, the claimed history by pricing at 25 bps lower than its guidance of 1.95 per cent above the US treasury, which came down to 170 bps over the 5-year US treasury at a price of 99.656 to yield 3.319 per cent.
"The notes will be denominated in US dollars, and will bear fixed annual interest of 3.25 percent, with interest payable semi-annually in arrears. The bank will apply the net proceeds to meet the funding requirement of its foreign branches and for general corporate purposes," the bank said.
In terms of geographic distribution, the notes were distributed 43 per cent in Asia, 48 per cent in Europe, and 9 per cent in the US and were lapped by fund managers (42 per cent), banks (43 per cent) insurance/sovereign wealth funds (10 per cent) and private banks and others lapping up 5 per cent.
Axis Bank's treasury president Sidharth Rath said, "The diversified participation across various investor-class and geographies shows the confidence of fixed income investors in our credit quality."
Last week, the ICICI Bank had raised 600 million (around USD 95 million) from the Chinese dim sum market in a 3-year money. This was the fourth yuan bond issuance by the largest private sector lender, which since 2012 had raised 2,050 million yuan.
