HDFC Bank may take infra bond route to raise around Rs 15,000 crore
HDFC Bank is making market enquiries about the issuance of infrastructure bonds worth around ₹10,000-15,000 crore as India's largest lender by market value looks to garner long-term capital and meet the reserve requirements arising out of its last-year merger with erstwhile parent HDFC.
«Bond markets are relatively stable now after the election-related volatility and for HDFC Bank, infrastructure bonds are a desirable option because these instruments bring leeway on maintenance of statutory liquidity ratio (SLR) and cash reserve ratio (CRR),» said a source aware of the developments.
An email sent to HDFC Bank requesting a comment on the matter did not receive a response by the time of publication. In April, HDFC Bank had said that it plans to raise up to ₹60,000 crore through the issuance of various types of bonds in the current financial year. Funds raised through infrastructure bonds, which have a minimum maturity of 7 years, are exempted from the maintenance of SLR and CRR, which are mandatory reserve requirements for banks.
SLR, which is the portion of deposits that banks must invest in liquid securities like government bonds, is currently at 18%. The CRR, which is kept with the RBI is at 4.5% of net demand and time liabilities, a proxy for deposits.
For HDFC Bank, the push towards infrastructure bonds comes at a time when the lender is trying to deftly balance the growing portion of deposits it must set aside as reserves after the merger with the relatively lower-yielding home loans that it inherited on its
