HDFC Bank Plans To Issue Bonds Of Up To Rs 50,000 Cr In FY24
HDFC Bank, the country's largest private-sector lender, plans to raise up to Rs 50,000 crore (about USD 6 billion) through bonds including additional tier (AT) I, tier II and infrastructure bonds in the next 12 months.
Commercial banks collectively raised over Rs 1.14 trillion in bonds (AT I, tier II and infrastructure bonds) in 2022-23, compared to approximately Rs 73,200 crore in FY22.
The largest issuer among commercial banks in FY23 was the country's largest bank, the State Bank of India (SBI). SBI raised around Rs 38,851 crore, followed by HDFC Bank (Rs 23,000 crore) and Axis Bank (Rs 12,000 crore).
The HDFC Bank board of directors will discuss this suggestion at its 15 April meeting.
According to the bank, these perpetual debt instruments (AT I bonds, Tier II capital bonds and long-term infrastructure bonds) would be placed through private placement. Its share price finished 0.34 per cent higher at Rs 1,663 per share.
HDFC Bank issued Rs 20,000 crore in Tier II bonds and Rs 3,000 crore in AT1 bonds in FY23. JM Financial Services data shows that it raised Rs 5,000 crore through infrastructure bonds in the previous fiscal year (FY22).
The bond's coupon rate increased, reflecting the fact that interest rates had stiffened and liquidity had tightened in FY23. This was the result of the Reserve Bank of India's monetary policy stance, which included raising rates and withdrawing accommodation.
This fiscal year, the private sector lender plans to merge with mortgage lender Housing Development Finance Corporation (HDFC).
HDFC Bank reported a 17 per cent YoY rise in advances to Rs 16 trillion at the end of March 2023. Advances were up 6.2 per cent sequentially over the December quarter. Its capital adequacy ratio was 17.66 per cent at the end of December 2022.
