IDBI Bank made the first publicly listed benchmark Singapore Dollar bond issue from India on August 21, 2012. The transaction received overwhelming response and the order book was oversubscribed by 12 times. The SGD 250 million bond issue is for a 3 year maturity and carries a fixed coupon of 3.65% p.a. This landmark issue by IDBI Bank will pave the way for other SGD bond issuances by Indian issuers.
This transaction is significant to India and IDBI Bank on several counts:
i) It is the first benchmark public bond transaction by any Indian entity in the Singapore Dollar bond market.
ii) It has opened up a new source of funding and investor diversification for Indian issuers.
iii) IDBI Bank is the only issuer from India to have tapped the Dim Sum (CNH) and Singapore Dollar (SGD) bond markets and is the only bank from India to have accessed the Swiss Franc (CHF) Bond Market in FY 2013.
iv) The transaction received a record oversubscription of 12 times which is the highest for any Indian bank.
v) The issue achieved the tightest pricing for any benchmark 3 year senior bond issue by any bank in the SGD market during 2012 year till date.
IDBI Bank undertook road shows in Singapore on August 14 and 15, 2012 which were very well attended by a diverse set of SGD focused private banks, asset managers and banks who were eager to hear the India and IDBI Bank story. The highly impressive and well received road shows led to some large accounts indicating initial interest in an issuance and IDBI Bank decided to capitalize on the same despite significant volatility in global credit markets.
The transaction was announced in the morning of August 21, 2012 as a SGD benchmark 3 year bond in the 4% area. The books grew rapidly and soared to over SGD 1 billion within 2 hours of opening. This enabled the announcement of a significantly tighter final guidance of 3.70% area post lunch in Singapore. The book continued to grow to over SGD 3 billion, allowing the final pricing outcome of 3.65% at the tight end of the
final price guidance. This price tightening of 35 bps from the initial price guidance is unprecedented.
The transaction attracted interest from a diversified array of investors including private banks (65%), asset managers (17%) and banks (18%). Around 78% of the book size came from Singapore, with the balance 22% being from Hongkong and other geographies.
DBS Bank, HSBC Bank and Standard Chartered Bank acted as Joint Book Runners and Lead Managers to the transaction.
This transaction is significant to India and IDBI Bank on several counts:
i) It is the first benchmark public bond transaction by any Indian entity in the Singapore Dollar bond market.
ii) It has opened up a new source of funding and investor diversification for Indian issuers.
iii) IDBI Bank is the only issuer from India to have tapped the Dim Sum (CNH) and Singapore Dollar (SGD) bond markets and is the only bank from India to have accessed the Swiss Franc (CHF) Bond Market in FY 2013.
iv) The transaction received a record oversubscription of 12 times which is the highest for any Indian bank.
v) The issue achieved the tightest pricing for any benchmark 3 year senior bond issue by any bank in the SGD market during 2012 year till date.
IDBI Bank undertook road shows in Singapore on August 14 and 15, 2012 which were very well attended by a diverse set of SGD focused private banks, asset managers and banks who were eager to hear the India and IDBI Bank story. The highly impressive and well received road shows led to some large accounts indicating initial interest in an issuance and IDBI Bank decided to capitalize on the same despite significant volatility in global credit markets.
The transaction was announced in the morning of August 21, 2012 as a SGD benchmark 3 year bond in the 4% area. The books grew rapidly and soared to over SGD 1 billion within 2 hours of opening. This enabled the announcement of a significantly tighter final guidance of 3.70% area post lunch in Singapore. The book continued to grow to over SGD 3 billion, allowing the final pricing outcome of 3.65% at the tight end of the
final price guidance. This price tightening of 35 bps from the initial price guidance is unprecedented.
The transaction attracted interest from a diversified array of investors including private banks (65%), asset managers (17%) and banks (18%). Around 78% of the book size came from Singapore, with the balance 22% being from Hongkong and other geographies.
DBS Bank, HSBC Bank and Standard Chartered Bank acted as Joint Book Runners and Lead Managers to the transaction.
No comments:
Post a Comment