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State Bank of India concluded the successful pricing of its USD 500 million "Regulation S" bond at a coupon rate of 5.25 per cent.
According to an SBI press release, the offshore debt capital market transaction was executed by the state-owned lender acting through its London branch. The bond issue was benchmarked against the 5-year US Treasury rate and priced at a spread of 88 basis points over the benchmark. Following the conclusion of the bond pricing process, the debt instruments will be listed on three international exchange platforms, namely SGX-ST, India INX, and NSE-IX. According to the official SBI press release, the transaction received an overwhelming response from the market and witnessed strong buying interest from institutional investors across multiple geographies. The bond issue reached a peak orderbook of USD 2.46 billion with participation from 145 investors. On the basis of strong investor demand during book building, the initial price guidance was revised downwards from the T+120 basis points area to T+88 basis points, resulting in an overall price compression of 32 basis points. The notes issued under the offering carry ratings from international and domestic rating agencies. As outlined in the SBI press release, the Notes will carry a rating of BBB from S&P, BBB- from Fitch, and BBB+/Stable from CareEdge Global, respectively. Commenting on the completion of the debt offering, Challa Sreenivasulu Setty, Chairman, SBI, said, "The successful pricing of USD 500 million, during the ongoing global uncertainties, is a testament to the strong appetite for bonds of SBI and to the diversified investor base the Bank has in offshore capital markets, allowing it to efficiently raise funds from the leading global fixed income investors." Elaborating on the significance of the tight spread attained in the debt market transaction, Setty stated, "The issue has priced at the tightest spread among all Indian public bond issuances since the RBI swap window announcement and reflects the confidence of the global investors in India's growth story in general and credit quality of SBI in particular." "The tight pricing achieved amid the evolving global macro environment has demonstrated containment in the borrowing cost for issuers from India," the SBI Chairman added. BNP PARIBAS, Citigroup, Credit Agricole CIB, Emirates NBD Bank PJSC, HSBC (B&D), MUFG, and Standard Chartered Bank served as the Joint Bookrunners for the offering. (ANI)
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