Tag: debt instruments

HDFC Bank’s AT-1 bond issuance successful

Banking & Finance

[ad_1]

Read More/Less


Private sector lender HDFC Bank raised $1 billion through additional tier-1 (AT-1) bond issuance from global markets.

“We are pleased to inform you that HDFC Bank has completed pricing of the US dollar denominated Basel III additional Tier I notes,” it said in a stock exchange filing.

The proceeds will be used for banking activities.

“This is the largest US dollar AT-1 offering by any bank from India. This will shore up HDFC Bank’s already strong Tier I capital base. The offering was well received by global investors and was oversubscribed by over three times after the final price guidance was released,” HDFC Bank said in a media statement.

Also see: HDFC Bank goes abroad for risky bond sale after India clampdown

The US dollar denominated, direct, subordinated, unsecured, Basel III Compliant, additional Tier 1 notes were priced at 3.7 per cent , 42.5 basis points lower than the initial price guidance

Moody’s Investors Service had assigned a provisional rating of Ba3 (hyb) to the issue.

“This is one of the tightest pricing achieved by any bank from Asia with Ba3 rating,” HDFC Bank further said, adding that the AT-1 notes will be listed on The India International Exchange (IFSC).

“We believe that this successful issuance will set the road for other Indian players looking to raise AT-1 bonds in the overseas markets. We are confident that the recovery in the Indian economy will pick up pace, with falling caseloads and increased vaccination coverage,” said Ashish Parthasarthy, Treasurer at HDFC Bank.

This is the second such issue by an Indian lender. Previously, State Bank of India had also raised capital by AT-1 bonds in the overseas market.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , ,

HDFC Bank approves issuance of debt instruments in the form of AT1 bonds from overseas markets

Banking & Finance

[ad_1]

Read More/Less


HDFC Bank on Monday said it will issue debt instruments in the form of Additional Tier 1 bonds in international markets. “…we had informed the stock exchanges that the Board of Directors of HDFC Bank in its meeting held on July 17, 2021, is contemplating raising of long term funds through the issuance of Basel III compliant Additional Tier 1 Bonds (Notes), in the international markets, subject to market conditions,” it said in a stock exchange filing.

An offering memorandum has been prepared and shall be made available to the prospective investors in relation to the contemplated issue of Notes, it further said. The bank, however, did not specify the amount to be raised.

Ba3 (hyb) rating

Meanwhile, Moody’s Investors Service in a statement said it has assigned a Ba3 (hyb) rating to HDFC Bank’s proposed USD-denominated, undated, non-cumulative and subordinated AT1 capital securities. “The Ba3 (hyb) rating is three notches below HDFC Bank’s baa3 Baseline Credit Assessment (BCA) and Adjusted BCA, reflecting the probability of impairment associated with non-cumulative coupon suspension, as well as the likelihood of high loss severity when the bank reaches the point of non-viability,” it said. In its meeting on July 17, the bank’s board had approved the issue of standalone foreign currency-denominated Perpetual Debt Instruments as Basel III-compliant AT1 bond for foreign (global) investors outside India, on an unsecured , public or a private placement basis, along with a proposed listing of the AT1 Bonds and other related activities in the course of the financial year 2021- 22, subject to market conditions and applicable approvals.

Also read: Is HDFC Ergo Optima Secure value for money?

Earlier, the State Bank of India had also raised capital by AT1 bonds in the overseas market. The capital raised through the AT1 bonds will help enhance the bank’s capital base. HDFC Bank’s total Capital Adequacy Ratio was at 19.1 per cent as on June 30, 2021 as against a regulatory requirement of 11.075 per cent.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , ,

Northern Arc’s AltiFi.ai to allow individuals to tap debt investment opportunities, BFSI News, ET BFSI

Personal Finance

[ad_1]

Read More/Less


Northern Arc has launched an alternative investment platform ‘AltiFi.ai’ allowing individual investors to invest in debt instruments.

‘AltiFi, stands for both “Alternative Financial Investments” and “Alternative Fixed Income”.
Investors will get access to debt capital markets and a range of debt instruments across bonds, securitised instruments and alternative investment funds’ units.

Investors can invest as low as Rs. 10,000 in debt papers.

Northern Arc said, it targets to bridge the gap of access to alternative investment assets and enable individual investors across the country to make direct debt investments at the click of a button.

Currently, individual investors have limited avenues to invest directly in debt instruments of small and mid-sized institutions. Northern Arc said it will bring together its 12 years of experience and well-tested proprietary risk models to create curated and pre-screened assets on the platform. It will also deploy AI and data analytics at scale to gather market intelligence and help investors make the most profitable and risk-adjusted investment calls.

Bama Balakrishnan, COO, Northern Arc said, “AltiFi is our attempt to offer unique debt investment opportunities to individual investors and family offices. Through AltiFi, investors will have access to a diverse range of debt products, in emerging sectors, that were hitherto available only to institutions so far. In India, debt investment opportunities are not accessible like the way listed equity is, and many investors who can potentially subscribe to these debt papers are either not aware of it or don’t know where to buy it from. We aim to change that with AltiFi.”



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , ,