Safety To Be Icici Umbrella For Bond Issues For Bonds

The Industrial Credit and Investment Corporation of India (ICICI) will use an umbrella brand name for all its future bond issues along the lines of the flexibond issues of the Industrial Development Bank of India (IDBI). ICICI has decided on the brand name safety.

The first of these issues the ICICI safety money multiplier and regular income bond of Rs 200 crore (with a green shoe option of another Rs 200 crore) and the ICICI safety tax saving bond of Rs 100 crore (with a green shoe option of Rs 100 crore) will open on March 16 for about ten days.

 

Sources said that a survey instituted by the ICICI revealed major plusses for bond issues that carry such an umbrella brand name. According to the survey they are more popular among investors, and, more importantly, the brand name gets associated with the institution concerned, which helps the institution tremendously, sources said. The survey for ICICI was done by an independent agency.

Merchant bankers point out that the name flexibond, in the case of the IDBI, has become extremely popular. And their success is likely to be emulated by other banks and institutions, which access the debt markets regularly.

ICICI last went to the bond market in December last year with two simultaneous (but not linked) public issues of unsecured redeemable bonds in the nature of debentures money multiplier bond and regular income bond together aggregating Rs 250 crore with a right to retain oversubscription up to Rs 250 crore. It also floated a tax saving bond aggregating Rs 50 crore with a green shoe option of Rs 50 crore.

ICICI meets its financing requirements through internally generated funds from loan repayments and interest payments, through borrowings, and through equity and equity-linked offerings in the domestic and international markets.

The RBI regulations, under which ICICI operates, do not permit it to accept demand deposits.