CA Grameen raises $100 mn via multi-currency syndicated loan facility

CreditAccess Grameen Limited announced on Tuesday that it has raised $100 million through a social loan from international banks, in a first-of-its-kind multi-currency loan raised in Japanese yen and US dollars.

 

The transaction came under the external commercial borrowing (ECB) route of the Reserve Bank of India (RBI), which means the bank did not require any approval from the central bank.

 

The funding comes through a syndicated loan facility, meaning multiple banks pooled in to provide the loaned amount. Most of these banks are from South Asia and Far East Asia.

 

It was the second syndicated loan facility for the company led by Standard Chartered Bank, which also led the first transaction to raise $200 million in 2023. 

 

 

The company initially planned to raise $70 million, but amid oversubscription from seven banks, the amount was increased to $100 million.

 

“The social loan shall adhere to CA Grameen’s Social Loan Framework, which aligns with the Social Loan Principles 2023, stipulating the use of proceeds, social development goals, and governance, according to the Loan Market Association,” the company said in a statement.

 

Nilesh Dalvi, Chief Financial Officer, CreditAccess Grameen, said that the borrowing cost in this transaction is highly competitive, lower than their average cost.

 

“It is deeply affirming to close our second syndicated social loan facility, and notably, the first in a multi-currency form, amounting to $100 million. The all-in borrowing cost of this transaction is highly competitive, comparable to domestic borrowing rates, and lower than our average cost of borrowing,” he said.

 

“We are confident of building on this momentum towards our dedicated target of 25–30 per cent foreign borrowings by FY28 to achieve geographic diversification, enhanced ALM position, and robust liability profile,” he added.

 

Surya Bagchi, Global Head - Financing Solutions, Standard Chartered Bank, said the loan was structured to facilitate the first-time lenders to CreditAccess Grameen.

 

“The syndicated term loan was structured to meet their bespoke requirements and our well-crafted, intensive syndication process enabled us to successfully complete bookbuilding using first-time lenders to CA Grameen - a testament to our deep understanding of the international syndication markets,” he said.