MUMBAI: Axis Bank on Thursday said it has raised USD 600 million (around Rs 4,380 crore) through the sale of sustainability-focused AT1 bonds.
The dollar-denominated, Basel III-compliant AT1 notes were finally priced at 4.10 per cent, 0.30 per cent lower than the initial price guidance, the bank said in a statement.
Under the Basel-III capital regulations, banks globally need to improve and strengthen their capital planning processes.
This is the maiden USD AT1 bond by an Indian issuer in a sustainable format and first time that the bank has accessed international bond markets after a 4-year hiatus.
The bank said the issue was oversubscribed 3.8 times ahead of the final pricing announcement and was well diversified across geographies and nearly half of the bonds were allotted to sustainability-focused investors.
The bank has set up a board-level ESG committee and has a sustainable financing framework, the statement said, adding that a second party opinion provider has graded it as 'Credible & Impactful'.
"This successful transaction, which is also the largest single-tranche USD bond issuance ever for Axis Bank, reflects the faith and confidence that international investors have reposed in the bank's franchise and robust credit and business model, its group executive and head of treasury Neeraj Gambhir said.
The issue follows similar AT1 bond issuances by HDFC Bank (USD 1 billion) and SBI (Rs 4,000 crore) done over the last fortnight, which are seen as signs of interest revival in the instrument.
Merchant bankers had on Wednesday said that Bluebay, Blackrock, Fidelity and HSBC Asset Management Company were among the major investors in the issue.
The merchant bankers to the issue include Bank of America, BNP Paribas, HSBC, Citigroup and Standard Chartered Bank.