HDFC Bank to raise ₹50,000 cr via bonds

This comes a couple of days after RBI governor Shaktikanta Das met bank chiefs and emphasised the need for raising adequate capital for strengthening balance sheets.

Private sector lender HDFC Bank on Wednesday said it plans to raise up to Rs.50,000 crore through private placement of debt instruments over the next 12 months. The bank’s board will consider the proposal on April 17.

HDFC Bank is well above minimum regulatory requirements. (REUTERS)

“...We wish to inform you that the bank proposes to raise funds by issuing perpetual debt instruments (part of additional tier I capital), tier II capital bonds and long-term bonds (financing of infrastructure and affordable housing) up to total amount of Rs.50,000 crore...” India’s largest private sector bank said in a regulatory filing.

This comes a couple of days after RBI governor Shaktikanta Das met bank chiefs and emphasised the need for raising adequate capital for strengthening balance sheets.

To be sure, HDFC Bank is well above minimum regulatory requirements.

HDFC Bank’s total capital adequacy ratio under Basel III guidelines stood at 18.9% as on December 31, 2020, as against a regulatory requirement of 11.075%, including capital conservation buffer of 1.875%, and an additional requirement of 0.2% on account of it being a Domestic Systemically Important Bank (D-SIB).

Some large banks such as Bank of Baroda, Canara Bank and Punjab National Bank had raised equity capital in 2020-21.