The private lender, HDFC Bank said it is seeking board approval for raising Rs 50,000 crore by issuing bonds. Reaffirming the rating of Bank, an American business and financial services company, Moody’s said that the deal would increase profitability in 2 to 3 years driven by higher funding costs and increased trust in market borrowing in the near term.
The bank has said that it has proposed to raise funds by issuing perpetual debt instruments, tier II capital bonds, and long-term bonds (financing of infrastructure and affordable housing) up to the total amount of Rs 50,000 crore. Further, it added that the board would hold a discussion on this proposal at its ensuing meeting schedules on April 16, 2022.
Analysts believe that HDFC Bank will have to raise sufficient funds to meet reserve requirements on the expanded balance sheet following the merger of HDFC’s business with its own.
