The bank hired Citigroup Inc and Deutsche Bank AG to arrange the sale and will meet investors in Singapore on Tuesday, according to Parthasarathi Mukherjee, its treasurer in Mumbai. It aims to complete the sale this week, Mukherjee said.
Indian banks are borrowing much more money due to the rapid loan growth the banks are experiencing, said Eugene Kim, managing director of Tribridge Investment Partners Ltd. in Hong Kong, a hedge fund which manages $100 million. There is also strong demand from investors, especially from the US, because they are very bullish on India.
Bank loans in India are set to grow 29% in the year to March 31, according to estimates from the central bank. Lending grew an average of more than 35% in the past two financial years.
The $775 billion economy has expanded an average of more than 8% in the previous three financial years and will accelerate to 9% this year, according to government estimates.