IIFL Finance Raises $175 Million From HSBC, Union Bank And Bank Of Baroda Via ECB Route

IIFL Finance, which is one of India’s largest non-banking finance Companies stated that it has raised $175 million through external commercial borrowing (ECB) route in the month of June 2023, the company on Monday announced through an exchange filing.

The retail focused NBFC has raised $75 million from HSBC, $50 million from Union Bank (Sydney) and $50 million from Bank of Baroda (IFSC unit).

The funds were raised at SOFR plus 200 basis points offering competitive sources of funds to the rapidly growing NBFC.

IIFL Finance’s external commercial borrowing of $175 million in June 2023 along with the $100 million funding raised in March 2023 will take the total borrowing since March 2023 to $275 million. Earlier on March 31, 2023, IIFL Finance had raised $100 million through ECB route which included $50 million in long-term funding from Export Development Canada with co-financing of $50 million from Deutsche Bank (Singapore).

“These funds are long-term in nature and will help us further strengthen our ALM position and support our continuous growth across our core businesses. This also helps in diversifying our borrowing sources and lower our overall borrowing costs,” said Kapish Jain, Group CFO, IIFL Finance Limited.

At the end of March 2023, the company at consolidated level has free cash and undrawn lines worth Rs 9,356 crores providing adequate liquidity buffer to services all commitments for the long-term.

IIFL Finance is one of the largest retail-focused non-banking financial companies in India with over 4000 branches and 85 lac customers. The company’s consolidated core business segments include home loan, gold loan, digital loan and micro finance loans catering to mostly unbanked and underbanked customers. The company is rated AA/Stable by CRISIL, ICRA and CARE and A1+ by CRISIL and ICRA. In April, Moody’s upgraded IIFL Finance’s international credit ratings to B1 stable from B2.

In June 2023, the NBFC’s secured retail public bonds issue was oversubscribed 1.5 times as it raised Rs 452 crores offering interest rates between 8.35 percent – 9 percent for different payment schedules and tenors varying from 24 months to 60 months.

In April, IIFL Finance, which had duly repaid $400 million along with interests it had raised through a maiden dollar bond issue in February 2020.

IIFL Finance is one of India’s largest retail-focused financial services companies. IIFL Finance’s Loan Assets under Management is Rs 64,638 crore as on March 31, 2023. Most importantly, 95 percent of the book is retail – which is focused on small-ticket loans. IIFL Finance has consistently maintained low level of NPAs over the years of operations and continues to focus on good quality of assets with Gross NPA of 1.8 percent and Net NPA of 1.1percent.

In FY23, IIFL Finance reported a profit after tax of Rs 1,607.5 crore, up 35 percent on year with a robust return on equity of 19.9 percent. It has strong relationship with multiple banks and financial institutions