Icici To Raise $100m From Subordinated Debt Issue

The Industrial Credit & Investment Corporation of India (ICICI) is currently in the market with a $100 million subordinated debt issue.

This issue, expected to be for a tenure of five years, is being arranged by two lead managers, one of them being SBC Warburg.

This is the first time an Indian financial institution (FI) is tapping the international debt market to raise subordinated debt.

The FI, which is also entering the retail debt market with a Rs 750 crore issue, will keep aside a substantial amount for Tier-II capital.

This will enhance the financial institutions tier-II capital, raising its capital adequacy and enhancing its exposure levels.

Confirming the developement, ICICI managing director and chief executive officer K V Kamath told Business Standard : This will strengthen our Tier II capital significantly and will stop us from entering the capital market for quite sometime.

ICICI intends to keep away from the debt market for the next three years, offcials added.

It had successfully raised $250 million through a global depository receipt (GDR) issue in August 1996.

Sources refused to divulge the interest rate at which the debt is being raised.

All I can say is that we are looking at a fairly attractive coupon. It will be one of the finest, Kamath said.