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					</table><p><a href="https://ind01.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.hdfcbank.com%2F&amp;data=05%7C01%7CAmit.Choudhary%40hdfcbank.com%7C49ca3cade3fb4a8032e708dbcb061511%7C827fd02205a64e57be9ccc069b6ae62d%7C0%7C0%7C638326999209325153%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=xxIia5anxb8s7V0fxBU6n%2FlXUTDr5htarCC3kO73BAY%3D&amp;reserved=0" target="_blank" rel="noopener">HDFC Bank</a> has raised $300 million through its first-ever sustainable bond issue, with the proceeds to be used to finance electric vehicles and green loans.</p>
<p>The bond, which has a three-year tenure with 95 basis points over the U.S. treasury, is part of an overall raise of $750 million through Regulation S bonds.</p>
<p>The bank said the remaining $450 million has been raised for a tenure of five years with over 108 basis points over the U.S. Treasury.</p>
<p>The bonds will be listed on the Indian International Stock Exchange (India NIX) in GIFT International Financial Services Centre (IFSC).</p>
<p>“&#8217;The funds raised through the sustainable finance bonds will be prioritized for lending towards electric vehicles, Small and Medium Enterprises, and affordable housing. We are strongly committed to building a green and social portfolio even as we continue adhering to the Bank’s risk philosophy,” said Arup Rakshit, group head of treasury at HDFC.</p>
<p>The bank had mandated <a href="https://home.barclays/" target="_blank" rel="noopener">Barclays</a>, <a href="https://business.bofa.com/content/boaml/en_us/home.html" target="_blank" rel="noopener">BofA Securities</a>,<a href="https://www.jpmorgan.com/" target="_blank" rel="noopener"> J.P. Morgan</a>, <a href="https://www.mufg.jp/english/index.html" target="_blank" rel="noopener">MUFG</a>, and <a href="https://www.sc.com/in/" target="_blank" rel="noopener">Standard Chartered Bank</a> as joint global coordinators and lead managers.</p>
<p>HDFC Bank claims these are the tightest credit spreads achieved by an Indian issuer for a three-year sustainable bond and five-year senior unsecured bond for a similar size of U.S. dollar Regulation S issuance.</p>
<p>In December 2022, HDFC <a href="https://www.mercomindia.com/ifc-extends-and-homefirst-to-promote-green-affordable-housing" target="_blank" rel="noopener">received</a> a loan of $400 million from the International Finance Corporation to improve climate-smart, affordable, and green housing in India. The funding was to help HDFC focus on its green affordable housing portfolio, with 75% ($300 million) of the proceeds earmarked for the sector. It also subscribed to India’s maiden issue of sovereign green bonds in the same year.</p>
<p>Last August, ICICI Bank <a href="https://www.mercomindia.com/icici-bank-lends-financing-portfolio-in-fiscal-2023" target="_blank" rel="noopener">offered</a> loans amounting to $6.7 billion to sustainability and renewable energy sectors, including EVs and green-certified real estate, for fiscal year 2023.</p>


HDFC Bank Raises $300 Million via Bond Issue to Fund Green Loans


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					</table><p><em>The article has been updated with the correct dollar conversion</em></p>
<p><a href="https://www.yesbank.in/" target="_blank" rel="noopener">YES BANK</a>  will provide term loans of up to ₹30 million (~$365,901) with a six-year tenure and six-month moratorium for micro, small, and medium enterprises (MSMEs) manufacturers to install ground-mounted or rooftop solar systems for their own electricity consumption.</p>
<p>For the YES KIRAN program, the bank has partnered with original equipment manufacturers and solar solution companies such as Tata Power Solar Systems, Goldi Solar, Loom Solar, and companies like Panasonic Solar Power System to promote the installation of solar systems.</p>
<p>Through this program, the bank aims to encourage adopting sustainable energy practices among small and medium-sized enterprises while also helping them reduce costs by minimizing expenses on power and fuel.</p>
<p>The financing program can benefit MSMEs from reduced operational costs, flexible loan tenures with competitive interest rates, end-to-end support from YES BANK, and access to a wide range of leading solar panel manufacturers and installers for informed decision-making.</p>
<p>The bank said the program&#8217;s introduction demonstrates its commitment to promoting renewable energy as a primary power source.</p>
<p>Dhavan Shah, the country head of SME banking at YES BANK, said YES KIRAN offers hassle-free financial solutions to encourage MSMEs to adopt solar energy best practices and achieve their sustainability goals while freeing up funds for their business requirements.</p>
<p>While solar is emerged as a viable solution for MSMEs to cut power bills, experts say that the small businesses are often not interested in installing any new infrastructure that can dent their regular cash flow.</p>
<p>Small Industries Development Bank of India (SIDBI), a bank dedicated to the financial needs of small businesses, <a href="https://www.mercomindia.com/sidbi-financing-rooftop-solar-reasonable-interest-rate" target="_blank" rel="noopener">offers</a> 100% loans for rooftop solar installations, which can help MSMEs save on substantial power costs, Abhishek Kumar, DGM, SIDBI, said at Mercom India’s C&amp;I Clean Energy Meet in Noida.</p>
<p>Last year December, industry experts at Mercom India’s Commercial and Industrial (C&amp;I) Clean Energy Meet <a href="https://www.mercomindia.com/renewable-experts-decode-ways-for-green-at-mercom-indias-event" target="_blank" rel="noopener">highlighted</a> the challenges in creating awareness among micro and small businesses – typically with a turnover of about ₹50 million ($605,102) annually — which are traditionally focused on their core businesses.</p>


YES BANK Offers up to ₹30 Million Loans to Some MSMEs for Solar Systems


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					</table><p>The government completed the sale of ₹160 billion (~$1.9 billion) worth of sovereign green bonds, with the second tranche raising ₹80 billion (~$970 million) on Thursday.</p>
<p>Like in the first tranche, the second tranche comprised ₹40 billion (~$485.56 million) worth of bonds with a five-year tenor and a like amount of bonds with a ten-year tenor.</p>
<p>The yield on the five-year bond closed at 7.25%, and the 10-year bond closed at 7.34%. The Reserve Bank of India (<a href="https://www.rbi.org.in/" target="_blank" rel="noopener">RBI</a>) had set the cut-off yields at 7.23% and 7.29 % for the two bonds, respectively.</p>
<p>The first tranche of India’s debut sovereign green bonds worth ₹80 billion (~$970 million) were auctioned on January 25, 2023. The first installment yielded a slightly higher premium than the second one.</p>
<p>In its half-yearly report on government finances, the RBI had said it would <a href="https://mercomindia.com/government-raise-%e2%82%b9160-billion-green-bonds-fiscal-year/" target="_blank" rel="noopener">issue</a> the green bonds in the last quarter of the current fiscal year 2022-23. The government has said the bond proceeds would fund ‘green’ projects in the public sector to reduce the economy’s carbon intensity.</p>
<p>Meanwhile, the green bond to be issued by the Indore Municipal Corporation to <a href="https://mercomindia.com/indore-raise-%e2%82%b92-45-billion-through-green-bonds/" target="_blank" rel="noopener">raise</a> ₹2.45 billion (~$29.5 million) for a 60 MW ground-mounted captive solar photovoltaic project in Madhya Pradesh will go on sale on February 10. The issue will close on February 14. The tenor of the green municipal bonds will be for 3, 5, 7, and 9 years with a coupon rate of 8.25%.</p>
<p>This week, the central bank said that it recognizes that climate change can translate into climate-related financial risks for regulated entities which can have broader financial stability implications. To prepare a strategy based on global best practices for mitigating the adverse impacts of climate change, it circulated a discussion paper on climate risk and sustainable finance for public comments last year.</p>
<p>Based on the analysis of the feedback received, RBI said it would issue guidelines for regulated entities on the following in a phased manner:</p>
<ul>
<li>Broad framework for acceptance of green deposits</li>
<li>Disclosure framework on climate-related financial risks</li>
<li>Guidance on climate scenario analysis and stress testing</li>
</ul>
<p>Further, the Reserve Bank will have a dedicated webpage on its website to consolidate all instructions, press releases, publications, speeches, and related communication on climate risk and sustainable finance.</p>


Government Completes Sale of Maiden ₹160 Billion Sovereign Green Bonds

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