- Amount Raised : INR 1000 Crores ( including greenshoe of INR 500 Cr )
- Tenor : 10 Years – Bullet Repayment
Mumbai, 25th February, 2015: YES BANK, India’s 4th largest Private Sector Bank has successfully issued India’s FIRST ever Green Infrastructure Bonds raising an amount of INR 1000 crores. The issue launched on February 16, 2015 for INR 500 crores plus green shoe option witnessed strong demand from leading investors including Insurance companies, Pension & Provident Funds, Foreign Portfolio Investors, New Pension Schemes and Mutual Funds, resulting in a total subscription of INR 1000 crores and was closed on February 24, 2015. The bonds are for a tenor of 10 years. YES BANK’s Sustainable Investment Banking and Debt Capital Markets team acted as arranger to the transaction.
The amount raised will be used by YES BANK to finance Green Infrastructure Projects in Renewable Energy including Solar Power, Wind Power, Biomass, and Small Hydel Projects. KPMG, India will be providing the Assurance Services annually, on the use of proceeds in accordance with the Green Bond principles.
Mr. Rana Kapoor, Managing Director & CEO, YES BANK said, “The highly successful issuance of India’s first ever Green Infrastructure Bonds issue by YES BANK is a landmark transaction in the realm of Green Infrastructure Financing in India. The issue received a total subscription of INR 1000 crores, which is twice the original issue amount, reflecting the faith and trust reposed in YES BANK’s knowledge and innovation driven business model by leading domestic Institutional investors.”
At the 1st Renewable Energy Global Investors Meet & Expo hosted by the Ministry of New and Renewable Energy, Govt. of India, YES BANK was the first Bank to have made a commitment of funding 5000 MW of Renewable Energy projects and the funds raised via this bond issue will be utilized towards meeting this commitment. YES BANK was the sole Knowledge Partner to this conference. YES BANK has also made a commitment of funding Clean Energy projects at the United Nations Climate Change Summit 2014.
The Bond issue comes on the back of a record USD 1.2 billion capital funds raised by YES BANK in 2014-15 through multiple transactions including a USD 500 million capital issue in May 2014, USD 422mn Syndicated Loan in October 2014 and USD 200 million Loan from Asian Development Bank in December 2014. In January 2015, YES BANK also signed an MoU of USD 220 million with OPIC, the US Government’s Development Finance Institution and Wells Fargo to explore financing to MSMEs in India.
Given the Govt. of India’s focus on India’s Renewable Energy Potential and target of 175 GW of additional capacity installation by 2022, it is estimated that the renewable energy sector will require significant structured financing. Currently, there are a number of challenges in the existing financing mechanisms including sector limits, high interest rates and Asset-Liability mismatch, and therefore there is a need to evolve innovative financing mechanisms to finance projects in the renewable energy and energy efficiency space. Green Infrastructure Bonds are one such specialised avenue to allow for financing to flow to vital green energy projects.
Globally, Green Bonds issues amounted to almost $35 billion worldwide in 2014 while the market in India is still nascent/non-existent. The first such green (infrastructure) bond issuance in India by YES Bank will catalyse the market for green infrastructure bonds in India and allow responsible investors to facilitate funding towards Renewable and Clean Energy projects.
About YES BANK
YES BANK, India’s fourth largest private sector Bank, is the outcome of the professional & entrepreneurial commitment, vision & strategy of its Founder Rana Kapoor and his top management team, to establish a high quality, customer centric, service driven, private Indian Bank catering to the Future Businesses of India.
YES BANK has adopted international best practices, the highest standards of service quality and operational excellence, and offers comprehensive banking and financial solutions to all its valued customers. YES BANK has a knowledge driven approach to banking, and a superior customer experience for its retail, corporate and emerging corporate banking clients. YES BANK is steadily evolving its organizational character as the Professionals’ Bank of India with the uncompromising Vision of “Building the Best Quality Bank of the World in India by 2020
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