ICICI Bank seeks $500 mn from overseas bond issue

ICICI Bank Ltd is tapping international investors for at least $500 million through five-and-a-half years' maturity tenure bonds, the issue of which was launched yesterday.

This is part of a $5-billion medium-term note (MTN) bond programme by India's largest private lender, an ICICI Bank spokesman confirmed in Mumbai.

The bond is likely to carry a base price of 375 basis points above the 5-year US Treasury rate.

''It is a US regulation 'S' bond which means that investors from the US cannot participate. We will open the issue this evening and the pricing will be clear by the end of US trading day,'' the spokesman said.

ICICI has already raised $3 billion out of its $5 billion programme. The proceeds of these issues are largely lent to Indian companies and non-resident Indians abroad.

Global rating agency Standard & Poor's Ratings Services rated the bonds at BBB-. ''The rating on the notes reflects the long-term counterparty credit rating on the bank. The proposed notes will constitute direct, unconditional, unsecured, and unsubordinated obligations of ICICI Bank. The proposed notes will be listed on the Singapore exchange,'' S&P said in a note.

Bank of America-Merrill Lynch NA, Barclays Plc., Citibank NA, Hong Kong and Shanghai Banking Corp. Ltd, Standard Chartered Plc. and Deutsche Bank AG are bankers to the issue.

The bonds will be listed on Singapore Exchange.

This is the second debt-raising by ICICI Bank this year after it had raised Singapore dollar (SGD) 225 million early in January in a seven-year bond sale programme through its Dubai branch, offering a coupon rate of 3.65 per cent. The bond was sold denominated in Singapore dollars.

In the last financial year, ICICI Bank had hit the market five times, raising $1 billion in two instalments of $750 million and $250 million. The bank had also raised a 1 billion yuan bond earlier in 2012, apart from a 100 million Swiss franc bond.