IFC to raise global rupee bond offer size

Also plans to guarantee bonds issued by some Indian companies

After raising about $1 billion through rupee-denominated bonds from global markets, International Finance Corporation (IFC) is planning to raise the size of such offerings, to raise money to finance private sector investments in India.

Another initiative would be to set up an IFC onshore programme to issue rupee bonds in the domestic market and to guarantee bonds issued by Indian companies.

"Supporting the development of India's capital markets and increasing the access to finance for the country's private sector is a priority for IFC. We are, therefore, looking at a number of ways to further help Indian businesses access the capital markets," it said in an e-mailed response to queries from Business Standard.

IFC, private sector investment arm of the World Bank group, hopes to build on the success of the $1-bn global rupee bond programme, particularly as India in 2013-14 accounted for $4.5 bn of IFC's committed investment portfolio, more than any other country.

"We, therefore, anticipate robust demand for rupee financing from our private sector clients. At the same time, we remain committed to supporting the development of India's capital markets. Therefore, we are currently exploring the possibility of significantly expanding the programme," IFC said.

On Friday, IFC issued seven-year bonds worth Rs 1,200 crore ($194 million), bringing to $1 bn the total amount raised under IFC's first global rupee bond programme. The offering was the longest-dated issue till now in offshore rupee markets. It was subscribed 140 per cent and most investors were from outside Asia. The bond yield was 8.25 per cent

IFC has also issued three-year bonds for Rs 3,000 crore and five-year bonds for Rs 2,000 crore. It invests the proceeds of these global rupee bonds to support private sector development in India across a range of sectors.