HDFC Bank raises $750 mn through 5-year bond issue via GIFT City IFSC unit

HDFC Bank, India's largest private-sector lender by market capitalisation, has raised $750 million through a five-year senior unsecured bond issue, leveraging the Reserve Bank of India's newly introduced concessional swap facility for foreign currency borrowings.

The fundraising was carried out through the bank's GIFT City IFSC Banking Unit, with the issuance completed on June 16, according to a regulatory filing.

The USD-denominated senior unsecured notes carry a coupon of 5.067% per annum and will mature on June 24, 2031. Interest payments will be made semi-annually on June 24 and December 24, with the first coupon payment scheduled for December 24, 2026.

The proceeds from the issue will be used for general banking activities, the lender said.

The bonds are expected to be rated Baa3 by Moody's Ratings and BBB by S&P Global Ratings, placing them firmly in the investment-grade category.

In a note, S&P Global Ratings assigned a 'BBB' long-term issue rating to the proposed notes, which are being issued under HDFC Bank's $4 billion medium-term note programme. The agency said it had equalised the rating on the bonds with HDFC Bank's issuer credit rating of BBB/Stable/A-2, reflecting its expectation that the notes will rank pari passu with all of the bank's other senior unsecured obligations.

"The notes will constitute direct, unconditional, unsecured and unsubordinated obligations of HDFC Bank," S&P said.

The bonds will be listed on India International Exchange (India INX) and NSE IFSC at GIFT City, providing access to a wider pool of international investors.

The fundraising highlights the growing appeal of overseas debt markets for Indian lenders seeking to diversify funding sources and optimise borrowing costs. The RBI's recent dollar-rupee swap window has further enhanced the attractiveness of foreign currency fundraising by helping banks manage hedging costs more efficiently.

Separately, HDFC Bank earlier this week allotted 31.6 lakh equity shares to employees following the exercise of stock options and restricted stock units (RSUs) under its Employees Stock Option Scheme (ESOS). Following the allotment, the bank's paid-up equity share capital increased from 1,539.76 crore shares to 1,540.08 crore shares of ₹1 each.

Meanwhile, shares of HDFC Bank ended Wednesday's session 0.27% higher at ₹786.80, with a market capitalisation of ₹12.11 lakh crore.