Exim Bank India green bond issue raises $500 mn

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Export-Import Bank of India, India’s premier export finance institution, successfully launched a 5 year Reg S Green Bond issue of US$ 500 mn on March 24, 2015. The issue attracted subscription of around 3.2 times the issue size led by strong demand, across 140 accounts The 5 year US$ 500 mn Eurodollar Green bond issue was priced at 147.50 basis points over US Treasuries (UST) at a fixed coupon of 2.75% p.a., cutting through the current secondary trading levels of similar bonds and achieving a pricing tighter than the Bank’s own US$ 500 mn Reg S bonds issued in February 2015 for a 5.5 year tenor. The above transaction is significant as it marks the first USD-denominated Green bond offering out of India as well as the first benchmark-sized Green bond out of Asia in 2015 and the third ever Green bond issuance out of Asia. It provides Exim Bank an opportunity to expand its investor base and to support an important market as investors seek more socially responsible investment options. Exim will use the net proceeds from the sale of the notes to fund Eligible Green Projects in countries including Bangladesh and Sri Lanka. The issue attracted over US$ 1.6 bn of book across 140 accounts with significant participation from green investors and real money accounts. The offering saw majority (58%) participation from fund managers, while banks (20%), sovereign wealth funds / insurance companies (18%) were the other major investor classes. The issue was distributed 60% to Asian investors, 30% to EMEA (Europe, Middle East and Africa) and balance to offshore US investors. Bank of America Merrill Lynch and J.P. Morgan acted as Joint Lead Managers on the offering.

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