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IFC Issues Largest Ever Offshore Rupee Bond, Supporting India’s Capital Markets


In Washington, D.C.:

Alexandra Kl÷pfer

Phone: +1 202 473-4645

E-mail:
Aklopfer@ifc.org

In New Delhi:

Minakshi Seth

Phone: +91 11 4111 1000

E-mail:
MSeth@ifc.org


Washington, D.C., March 13, 2014—IFC, a member of the World Bank Group, today issued a five-year, 20 billion global rupee bond (approximately $328 million) to promote capital market development and encourage foreign investment in India.

This is the largest offshore Indian rupee bond issuance to date, highlighting the growing confidence of international investors in India’s economy. The order book reached close to 25 billion rupees. Over two-thirds of the IFC bond buyers are U.S. and European asset managers, insurance companies, private banks, and real money investors. The bond yield is 7.8 percent.


“IFC’s five-year global rupee bond comes to market at a time when foreign investors are seeing renewed opportunity in India’s capital markets,” said IFC Vice President and Treasurer Jingdong Hua. "The bond supports this momentum while providing a unique bridge that links international investment with India's private sector financing needs."


The issuance brings to nearly $815 million the amount of notes issued under IFC’s $1 billion global rupee bond program, launched late last year. IFC global rupee bonds are denominated in Indian rupees but settled in U.S. dollars, with all principal and coupon payments tied to the U.S. dollar-rupee exchange rate. IFC converts bond proceeds from dollars into rupees on the domestic spot exchange market, and uses the rupees to invest in the country. Under the program IFC also has a three-year outstanding bond of 30 billion rupees.


India accounted for $4.5 billion of IFC’s committed investment portfolio as of June 30, 2013—more than any other country. In FY13, IFC invested $1.38 billion in India to achieve several strategic priorities such as promoting inclusive growth in India’s low-income states, addressing climate change, and supporting global economic integration.


Over the years, IFC has issued bonds in 14 local currencies, including the Brazilian real, the Chinese renminbi, the Nigeria naira, and the Russia ruble. Often, IFC is the first international or corporate issuer of local-currency bonds in a market. When issuing local-currency bonds, IFC works closely with regulators and market participants to refine the regulatory framework, encouraging greater participation in the local markets and providing a model for other international issuers.


Deutsche Bank, JP Morgan, and TD Securities acted as lead managers for the bond.


About IFC

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
 
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