Indian Bank Secures Rs 5,000 Crore Through Long-Term Infrastructure Bonds
State-owned Indian Bank has successfully raised Rs 5,000 crore by issuing long-term infrastructure bonds, significantly overshooting its initial target. The bank attracted a total of 88 bids amounting to Rs 13,680 crore for the bond issuance, which had a base size of Rs 2,000 crore and a greenshoe option allowing an additional Rs 3,000 crore.
The bonds, carrying an annual coupon rate of 7.24%, were issued in response to robust investor interest, with the subscription reaching 2.74 times the total issue size. This substantial influx of capital will support Indian Bank's objectives of boosting credit growth and refinancing infrastructure projects.
The bonds, which were allotted on Friday, are characterized as senior, rated, listed, unsecured, and redeemable, with a fixed term of 10 years from the allotment date. They are fully paid-up and non-convertible, and benefit from exemptions from the Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CRR) regulatory requirements.
The infrastructure bonds have received high ratings of AAA with a stable outlook from leading credit rating agencies CRISIL and CARE, underscoring their strong credit quality. This strategic financing move aligns with Indian Bank's broader goals of strengthening its financial position and enhancing its capacity to fund key infrastructure initiatives.
