The is the second dollar bond by the private sector bank within a week after it raised $750 million through a five year public issue on August 17.Separately, public sector Union Bank of India has raised $600 million by selling its first international dollar bond in more than a decade as it became the latest among multiple Indian banks to take advantage of the special Reserve Bank of India (RBI) swap window.The bank raised $300 million each by selling three year and five year dollar bonds in a public issue marketed to international investors in Asia and Europe. “The three year bond was priced at 93 basis points above the three year US treasury while the five year issue was priced at 102 basis points above the five year US treasury.
Both bond were priced at a rate tighter than the initial price guidance issued by the bank earlier today with a order book of $4.7 billion,” said a person aware of the details.
One basis point is 0.01 percentage point.Earlier on Monday, Union Bank had set a guidance of 120 basis points above the three year US security for the three year bond and 130 basis points above five year US treasury guidance.
With the three year US treasury trading around 4.29% and five year US treasury around 4.39% Union Bank is likely to raise three year money at 5.22% and five year money at 5.41%.
