IDBI Bank is the first Indian bank to make a Swiss Franc Bond Issue during 2012. The Bank launched a Swiss Franc (CHF) denominated bond on March 16, 2012 for an amount of CHF 100 million (approximately Rs 620 crore) with a maturity of three and a half years.The issue received encouraging response and was oversubscribed. IDBI Bank decided to close the issue the same day with an issue size of CHF 110 million at an annual coupon of 3.125%. The documents for the issue were signed on April 10, 2012 and the proceeds of the issue are being received today. The issue is being made by IDBI Bank through its offshore branch at Dubai International Financial Centre (DIFC), Dubai. The main investors for the issue are Private Banks and High Networth Individuals. Deutsche Bank was the sole lead manager and book-runner for the issue.
In 1987, IDBI was the first Indian entity to make a Swiss Franc Bond Issue with an issue size of CHF 100 million. This issue was redeemed in 1997. The current CHF issue reinforces IDBI Bank's presence in the Swiss Franc Bond Market. The issue was a sequel to investor meetings held last year for updating investors on the IDBI Bank story. IDBI Bank has been tracking the interest rates in the Swiss Franc Market and was able to capture the improved tone in the CHF market to strategically issue the bonds at an attractive pricing level of 3.125%.
Shri R. M. Malla, Chairman & Managing Director, IDBI Bank while commenting on the issue stated, "IDBI Bank has always taken a proactive stance towards overseas funding and this CHF bond is the latest example following in the footsteps of the Dim Sum Bond which was the first for any Indian entity made by IDBI Bank in November 2011. We are particularly pleased that investors in Switzerland have appreciated India's growth potential and IDBI Bank's credit story and have wholeheartedly supported this landmark deal which is the first by any Indian bank during 2012. It is a true testimony to the faith that the global investor community reposes in IDBI Bank that we managed to undertake a tightly priced and oversubscribed deal".
Shri Melwyn Rego, Executive Director, stated, "IDBI Bank has, over the years been the first Indian issuer in virtually all international markets. The Swiss Franc Bond Market has offered IDBI Bank strategic benefits in terms of investor diversification and attractive funding rates. With our strong credit positioning, IDBI Bank's story has appealed to a broad range of investors in diverse markets. As investors in the Swiss Franc Bond Market continue to globally diversify their holdings, we feel confident that IDBI Bank can repeat its success in the CHF market in future as well".