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Bank of India is planning to raise up to INR 100 billion through a 10-year infrastructure bond issue, according to bankers. The state-run lender has invited coupon and commitment bids, with bidding scheduled for December 23. The issue includes a base size of INR 50 billion and a greenshoe option of the same amount. The bonds will carry a AA+ rating from Crisil and Care Ratings, while the coupon will be finalised through bidding. The bank has not officially commented on the proposed issuance.
India's state-owned Bank of India is preparing to raise up to INR 100 billion through a new issue of 10-year infrastructure bonds, according to market participants familiar with the development. The proposed fundraising is part of the lender's ongoing efforts to secure long-term resources aligned with infrastructure financing needs. Advertisement
The bank has sought coupon and commitment bids from investors, with the bidding process scheduled to take place on December 23. Bankers indicated that the issue size comprises a base amount of INR 50 billion along with a greenshoe option of an equal size, allowing the lender to increase the total raise depending on demand.
The coupon for the bonds will be decided through the bidding process. The planned issuance carries a AA+ rating from Crisil and Care Ratings, reflecting the bank's credit profile and its status as a government-owned lender. Bank of India did not respond to a request for comment.
Infrastructure bonds are typically used by Indian banks to raise longer-tenure funds without increasing short-term asset-liability mismatches. Bank of India has tapped the bond market on multiple occasions in the past to support lending growth, capital adequacy, and infrastructure exposure. The current proposal comes at a time when public sector banks are increasingly relying on bond issuances to fund credit demand while managing balance sheet stability.
Source Reuters
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