Mumbai: HDFC Bank, India’s largest private sector bank, has been making inquiries in the bond market about the issuance of long-term infrastructure debt worth up to ₹10,000 crore in coming weeks.
If conducted, the issuance would mark HDFC Bank‘s first bond issuance since its merger with HDFC, which became effective in July.
“They (HDFC Bank) have been checking in the market for an infrastructure bond issuance and are in communication with end-investors which are large institutional players,” a source aware of the developments said.
An email sent to HDFC Bank did not receive a response by press time. Over the past few weeks, banks have favoured infrastructure bonds as an instrument to raise long-term capital. Infrastructure bonds are securities with a minimum maturity of seven years. Given that the funds raised through such bonds are used for infrastructure lending, the RBI permits exemptions on Statutory Liquidity Ratio and Cash Reserve Ratio for such debt. Earlier this week Canara Bank raised ₹5,000 crore through the issuance of 10-year infrastructure bonds at a coupon rate of 7.54%, sources said.
