The issue, launched on Tuesday, attracted subscription of around 3.2 times the issue size led by demand across 140 accounts.
“The five-year $500-million Eurodollar Reg S Green bond issue was priced at 147.50 basis points over US Treasuries (UST) at a fixed coupon of 2.75 per cent p.a., cutting through the current secondary trading levels of similar bonds and achieving a pricing tighter than the bank’s own $500 million Reg S bonds issued in February 2015 for a 5.5 year tenor,” EXIM Bank said in a statement.
The above transaction marks the first USD-denominated Green bond offering out of India as well as the first benchmark-sized Green bond out of Asia in 2015 and the third ever Green bond issuance out of Asia. It provides Exim Bank an opportunity to expand its investor base and to support an important market as investors seek more socially responsible investment options. Exim will use the net proceeds from the sale of the notes to fund eligible green projects in countries including Bangladesh and Sri Lanka, it said.
The issue attracted over $1.6 bn of bookings across 140 accounts with significant participation from green investors and real money accounts. The offering saw majority (58 per cent) participation from fund managers, while banks (20 per cent), sovereign wealth funds / insurance companies (18 per cent) were the other major investor classes. The issue was distributed 60 per cent to Asian investors, 30 per cent to EMEA (Europe, Middle East and Africa) and the balance to offshore US investors. Bank of America Merrill Lynch and J.P. Morgan acted as Joint Lead Managers on the offering.
Exim Bank of India has been rated ‘BBB-’ by Standard and Poor’s and ‘Baa3’ by Moody’s, same as the rating of Government of India.
David Rasquinha, Deputy Managing Director of Exim Bank, commented, “We were able to upsize the transaction to $500 million from initial indication of $250-300 million based on a strong investor response. The deal followed calls with select global investors spanning over two days. We were able to pick the optimal execution window and are satisfied with the outcome.”
Source : Thehindubusinessline