India's Kotak Mahindra joins peers in tapping dollar debt before RBI window shuts

Kotak Mahindra Bank

19/08/2026 04:27

By Dharamraj Dhutia
MUMBAI, Aug 19 (Reuters) - India's Kotak Mahindra Bank KTKM.NS has accepted bids worth $650 million for its U.S. dollar bonds maturing in five years at a coupon rate 27 basis points lower than the initial price guidance, three bankers said on Wednesday. 

Here are a few details: 
Kotak Mahindra Bank is the sixth Indian lender to raise dollar funds through sale of bonds under the central bank's discounted swap window
The private lender will pay a coupon of 5.4780%, 108 basis points above U.S. Treasuries 
The net proceeds will be used to diversify the bank's funding sources and for general corporate purposes
Indian lenders have raised an aggregate of $6.95 billion since the Reserve Bank of India announced a concessional hedging facility on June 5
ICICI Bank leads the race, followed by Axis Bank; these lenders have raised more than half of the total quantum
Most of the funds raised through these bond issuances would be used for leverage on non-resident deposits
RBI had provided a discounted swap facility to banks for hedging against these deposits, which will close on August 31, a month earlier than planned, leading to a race for raising dollars
 

 (Reporting by Dharamraj Dhutia)
 ((Dharamraj.Dhutia@thomsonreuters.com;))