The Export-Import Bank of India (EXIM Bank) yesterday listed US$400 million in bonds in Taiwan, becoming the first Indian institution to sell bonds to raise funds on the Taiwanese financial market, the Taipei Exchange (TPEX) said.
The TPEX, which operates the bond market in Taiwan, said EXIM Bank simultaneously listed the tranche of bonds, with a maturity of five years, in Singapore.
The bonds issued by the state-owned Indian bank carry a floating coupon rate based on the three month London interbank offered rate (LIBOR) plus 100 basis points, TPEX said.
The coupon rate stood at 2.3164 percent yesterday, the exchange said.
The tranche of bonds sold by EXIM Bank was the 20th that came with a floating rate. The previous 19 tranches were all sold by foreign institutions, the TPEX said.
Proceeds from the bond sale are to be used to repay EXIM Bank’s debt and extend loans to clients.
London-based Standard Chartered Bank and Taiwan-based President Securities Corp (統一證券) served as underwriters for the bond issue.
Standard Chartered Bank said serving as an underwriter for EXIM Bank’s bonds represented a new milestone for the British bank, which is looking to boost its presence in the Taiwan market.
Standard Chartered added that the move was in accordance with the Taiwanese government’s New Southbound Policy, which aims to forge closer economic ties with ASEAN members, South Asian states, Australia and New Zealand.
The policy was initiated by the Democratic Progressive Party, which took office in May last year, as part of its efforts to reduce economic dependence on China.
Standard Chartered said that EXIM Bank, set up in 1981 and headquartered in Mumbai, provides loans to Indian importers and exporters as a way to promote economic development in the South Asian country.
Standard Chartered said it would encourage more enterprises from India and Southeast Asian countries to issue foreign currency-denominated bonds in Taiwan to demonstrate the bank’s commitment to the Taiwan market.
Outstanding foreign currency-denominated bonds issued in Taiwan totaled US$121.36 billion in 452 tranches, including 87 tranches denominated in Chinese yuan valued at 55.97 billion yuan (US$8.39 billion), as of the end of last month, according to the TPEX.
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