Now Reading: Union Bank raises $600 mn via bonds for business growth
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Union Bank raises $600 mn via bonds for business growth
Union Bank of India has raised $600 million through bonds issued to overseas investors. The funds will be used to support business growth, the state-owned bank said in a regulatory filing.
Union Bank of India has raised $600 million through bonds issued to overseas investors. The funds will be used to support business growth, the state-owned bank said in a regulatory filing.
The bonds were issued as USD REG S Senior Unsecured Dual Tranche Notes through the bank's Dubai International Financial Centre branch. Each tranche is worth $300 million, with tenors of three years and five years, maturing in 2029 and 2031 respectively.
The three-year bonds carry a coupon rate of 5.230%, while the five-year bonds carry 5.417%, payable semi-annually. The notes are to be listed on the NSE IFSC Limited.
Indian Opinion Analysis
This dollar-denominated issuance by a public sector bank comes at a time when Indian lenders are diversifying funding sources beyond domestic deposits. The dual-tranche structure lets Union Bank match different investor appetite for tenor and yield. Under RBI's External Commercial Borrowings framework, such overseas bond raisings are permitted for specified end-uses. The coupon rates, benchmarked to US Treasury yields plus a spread, reflect current global credit conditions for Indian state-owned banks. The listing on NSE's International Financial Services Centre in Gandhinagar provides regulatory clarity and access to a growing offshore rupee-denominated bond platform. Investors will watch how the bank deploys this capital against its credit growth targets over the next two quarters.
Source: thehindu.com
This brief was synthesised by AI from the source linked above.
