India's largest public sector bank SBI (SBI Bonds) has raised $500 million from foreign investors through bonds. The special thing was that the price of this issue was kept 75 basis points higher than the US Treasury yield. This is the lowest pricing ever for such a bond by an Indian issuer. Sources said that the organizers of this issue were HSBC, Citi, JP Morgan, MUFG, Standard Chartered and SMBC Nikko.
State Bank of India has raised $500 million from international investors through dollar bonds at the lowest ever margin against US Treasury bonds. This move has been taken at a time when a few weeks ago, international rating agency Standard & Poor's raised India's sovereign rating from 'BBB-' to 'BBB'.
S&P Global Ratings had also upgraded India's rating. The agency has rated India as one of the best-performing economies, with an average real GDP growth of 8.8% from FY22 to FY24 despite significant global trade uncertainties and geopolitical challenges.
The bond issue received orders of over $1.1 billion from 85 accounts. However, SBI decided to retain the target amount of $500 million. The bond was oversubscribed, reflecting strong demand from investors in Asia, West Asia and Europe. The SBI bond issuance was pegged to the 5-year US Treasury bond and was priced at a margin of 75 basis points from the benchmark.
SBI Chairman Challa Srinivasulu Shetty said the success reflects global confidence in India's growth story and SBI's lending capacity. He further said the pricing sets a new benchmark, reflecting lower borrowing costs for Indian issuers following a rating upgrade.
HSBC India's Siddharth Sharma said the success of the deal reflects India's strong financial system and investor confidence as spreads were reduced by 30 basis points during the process.
1.png)
1.png)
2.png)
.png)
-(1).png)
1.png)
