ICICI Bank to raise up to Rs. 8,000 crore via infra bonds

Private sector lender ICICI Bank is planning to raise upto Rs 8,000 crore through infrastructure bonds to finance projects in sectors like transport and power and affordable housing.

Debt market sources said while the private lender is raising upto Rs 8,000 crore in current round, rating agency Crisil has assigned “AAA/Stable” for Rs 10,000 crore of bonds. Lenders have always an option to raise money in tranches.

The issue size is Rs 500 crore with green shoe of Rs 7,500 crore. It will be a 10-year paper. The interest rate rate scenario is unclear due to volatility in markets. The highly rated long term paper (10-year) from corporate would see a coupon of around 7.25-30 %, bond dealers said.

ICICI Bank did not respond to email queries on fund raising through infrastructure bonds. Its exposure to Road, ports, telecom, urban development and other infrastructure was Rs 48,981 crore at end of March 2021, according to annual report for FY21.

Funds raised through this route are exempt from liquidity norms Cash Reserve Ratio and Statutory Liquidity Ratio (SLR) requirements and are deployed in long term infra and affordable housing credit.

Crisil in its rating review said the bank actively finances projects for capacity creation in environment-friendly sectors like renewable energy and other sustainable sectors.