Global woes hit Indian banks' fund-raising plans
Sunday, 7 February 2010
MUMBAI, Feb 6 (Reuters): The turmoil in the international market has made it difficult for Indian banks to raise money overseas. Late Thursday, Bank of Baroda decided to put its overseas bond issue on hold while Bank of India, which is currently doing roadshows for an international bond issue, is yet to decide whether to go ahead with its issue.
After SBI successfully raised $750 million through the issue of medium-term notes in October last year, many Indian banks were also inspired to raise money overseas. Bank of Baroda had planned to raise $500 million while Bank of India is looking at raising $300-500 million. Incidentally, even Axis Bank had to postpone its issue.
Speaking to reporters, Bank of Baroda CMD MD Mallya said: "The issue is put on hold, it is not shelved. We are not in a desperate need to raise money now. Since the pricing on the issue did not meet our exception, we did not go ahead with it.
We thought it would be better for the market to cool down and then have a relook at it again." The money was being raised for its overseas operation and was not part of its core capital.
Meanwhile, Bank of India CMD Alok Misra and executive director B Prabhakar, are overseas for a roadshow to sell its MTN bonds. "Our senior management is overseas for a roadshow and are meeting investors.
We will go ahead only if the pricing meets our expectation. It is too early to say whether we will surely go ahead with the issue," Bank of India ED M Narendran said.
After SBI successfully raised $750 million through the issue of medium-term notes in October last year, many Indian banks were also inspired to raise money overseas. Bank of Baroda had planned to raise $500 million while Bank of India is looking at raising $300-500 million. Incidentally, even Axis Bank had to postpone its issue.
Speaking to reporters, Bank of Baroda CMD MD Mallya said: "The issue is put on hold, it is not shelved. We are not in a desperate need to raise money now. Since the pricing on the issue did not meet our exception, we did not go ahead with it.
We thought it would be better for the market to cool down and then have a relook at it again." The money was being raised for its overseas operation and was not part of its core capital.
Meanwhile, Bank of India CMD Alok Misra and executive director B Prabhakar, are overseas for a roadshow to sell its MTN bonds. "Our senior management is overseas for a roadshow and are meeting investors.
We will go ahead only if the pricing meets our expectation. It is too early to say whether we will surely go ahead with the issue," Bank of India ED M Narendran said.