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After a long lull, domestic corporates and financial institutions are back in the overseas debt market with bond sales, to cash in on the low interest rates after the US Fed left key rates unchanged last month.
The latest to join the dollar bond market is the national institution Exim Bank which today hit the market "with a benchmark issue to raise at least USD 300 million in dollar money", according to merchant banking sources.
"The Exim Bank is in the dollar bond market with a benchmark issue. It's planning to raise at least USD 300 million and has given a price guidance of 115 bps over the three-month Libor (London interbank overnight rates)," a merchant banker working on the issue told PTI.
The source said the issue is part of the USD 10 billion medium term note of the developmental institution and will be traded on the Singapore and Taipei stock exchanges.
Three domestic entities raised USD 1.9 billion in dollar money last week.
While the Anil Agrawal-promoted London-based Vedanta Resources mopped up USD 1 billion from the US debt market, Axis Bank too raised USD 500 million and the state-run Canara Bank sold USD 400 dollar notes in the week.
International rating agency Moody's has assigned a Baa3 rating to the USD-denominated senior unsecured notes as part of Exim Bank's USD 10 billion global medium-term note programme.
The notes will be raised through the bank's headquarters in Mumbai, it said.
"The rating outlook is positive," Moody's said in a note, and said the Baa3 rating reflects the status of the proposed notes as senior unsecured obligations of the bank, the bank's baseline credit assessment of ba3 and the agency's assessment of the bank's very high dependence on, and the high probability of, support from the government.
Rival agency Fitch Ratings also assigned a 'BBB' ratings to the note with stable outlook.
The agency said the senior unsecured notes are rated at the same level as the bank's issuer default rating, in accordance with the agency's criteria.
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