HDFC Bank, India’s largest private-sector lender, has raised $750 million through a five-year senior unsecured bond issue via its International Financial Services Centre (IFSC) Banking Unit at GIFT City. The transaction marks one of the larger offshore fundraisings by an Indian bank this year.
According to an exchange filing, the dollar-denominated bonds carry a fixed coupon of 5.067% and will mature on June 24, 2031. The notes are expected to be rated Baa3 by Moody’s Ratings and BBB by S&P Global Ratings. The proceeds from the issuance will be used for general banking purposes.
The bonds will be listed on the India International Exchange (India INX) and the NSE International Exchange at GIFT City. The issuance is structured as unsecured debt and will rank pari passu with the bank’s other senior unsecured obligations, with principal repayment scheduled at maturity.
The fundraising comes amid regulatory support measures introduced by the Reserve Bank of India (RBI), which has opened a concessional swap facility for overseas foreign currency borrowings by banks to attract foreign capital and improve liquidity conditions. Under this mechanism, the RBI offers swaps at a fixed rate of 1.5% per annum for eligible borrowings with a minimum maturity of three years.
Market participants estimate that hedging costs under the RBI framework are significantly lower than prevailing market rates, making offshore borrowings more cost-efficient compared to domestic funding. Analysts also suggest that such funding avenues could ease pressure on deposit mobilisation and help improve credit flow by reducing overall borrowing costs in the financial system.
