Market intelligence firm CreditSights sees the fair value of the notes at around 5 bps below SBI's paper as both banks are underpinned by central government support and have similar credit metrics.This is the first time that BoB has tapped the dollar bond market in seven years.
The issue was sold at a spread of 88 bps over Treasuries, sharply lower than an earlier guidance of 120 bps, with bidding nearly touching $2.5 billion.Private lenders HDFC Bank, Axis Bank and ICICI Bank have also raised funds through dollar bonds since June at spreads tighter than their initial guidance.BoB will use the proceeds towards various funding requirements, and the bonds will be rated 'BBB', 'BBB-' and 'BBB+' by S&P, Fitch Ratings and CareEdge Ratings, in line with the issuer's ratings.
