IIFL Finance raises $175M from HSBC, Union Bank & Bank of Baroda

IIFL Finance raises $175M from HSBC, Union Bank & Bank of Baroda

IIFL Finance raises $175M from HSBC, Union Bank & Bank of Baroda

In a recent announcement, IIFL Finance, one of India’s leading non-banking finance companies, revealed that it has successfully raised $175 million through external commercial borrowing (ECB) in June 2023. The funds were provided by renowned financial institutions including HSBC, Union Bank, and Bank of Baroda. This comes as a significant boost to IIFL Finance, which had previously raised $100 million through the ECB route in March 2023. Notably, this included $50 million in long-term funding from Export Development Canada, along with a co-financing amount of $50 million from Deutsche Bank in Singapore.

Kapish Jain, the Group CFO of IIFL Finance, expressed his satisfaction with the fundraising efforts, stating, “These funds have a long-term nature and will greatly enhance our asset-liability management position while supporting the continuous growth of our core businesses. Additionally, diversifying our borrowing sources will reduce our overall borrowing costs.”

IIFL Finance had also recently launched a public issue of secured bonds in June, aiming to raise ₹1,500 crore. The firm plans to generate funds through secured non-convertible debentures (NCDs). These bonds offer an attractive effective yield of 9 percent per annum for a tenure of 60 months. The NCDs are available in tenures of 24, 36, and 60 months, offering various options for investors. Interest payment frequencies include annual, at-maturity, and monthly options for the 60-month tenure.

Moody’s Investors Service, a reputable rating agency, upgraded IIFL Finance Limited’s long-term corporate family rating to B1 from B2 on April 6. In addition, the rating agency raised IIFL Finance’s foreign currency senior secured debt rating to B1 from B2 and the foreign and local currency senior secured medium-term note program ratings to (P)B1 from (P)B2. Moody’s attributed these positive changes to the company’s asset-light business model, which has significantly improved its profitability, capital, and funding. The agency maintains a stable outlook for IIFL Finance.

Moody’s report also highlighted the substantial growth in IIFL Finance’s off-balance sheet loans, which accounted for 37% of its total assets under management (AUM) by the end of December 2022, compared to 21% in March 2019 (fiscal year 2019). This expansion has positively impacted the company’s funding, profitability, and capital.

About IIFL Finance:

IIFL Finance Limited, also known as IIFL and India Infoline Finance Limited, is a financial services company based in Mumbai, India. It offers a wide range of financial solutions and is led by its founder, Nirmal Jain.

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