Bank of Maharashtra and Canara Bank are planning to raise funds through dollar bonds, with bankers indicating both lenders would issue about $500 million each. The issuances are expected to be completed in September.
The notes are anticipated to have three-year or five-year tenors and will be issued under a concessional swap window, a structure designed to lower the cost of hedging currency exchange rate risks for the borrowers.
Bank of Maharashtra would be making its debut in this type of issuance, while Canara Bank has issued dollar bonds previously.
These planning steps reflect a strategy to diversify funding sources and manage FX risk as part of the banks’ funding operations. The September completion window is noted by market participants as indicative of the current borrowing plan.
