Axis Bank’s proposed Rs 5,000-crore debt sale could be priced at a coupon of 7.66%, three sources familiar with the placement said on Wednesday. The tenure of the securities is likely to be 10 years, and the issuance may take place by the end of this week. Ratings agency Crisil has assigned its ‘CRISIL AAA/Stable’ rating to the Rs 5,000-crore Tier-II bonds (under Basel III) of the bank. It has reaffirmed its ratings on the bank’s existing debt instruments at ‘CRISIL AAA/CRISIL AA+1/Stable/CRISIL A1+’. “The overall ratings reflect Axis Bank’s strong capitalisation, healthy resource profile, and comfortable earnings. However, the asset quality is average and remains sensitive to stress, mainly in the corporate sector loan portfolio,” Crisil said in a ratings rationale dated June 13. Axis Bank on Monday said it proposes to raise Rs 5,000 crore through non-convertible debt securities, subject to the approval of the board of directors.
“We inform that the bank proposes to raise funds by issuing unsecured, redeemable, non-convertible subordinated debentures (Basel III compliant Tier 2 debentures, series -27) of the face value of 10 lakh each for cash at par aggregating to Rs 5,000 crore,” the bank had said in a notification.
By Shamik Paul