InCred, a new-age financial service platform, has announced that it has successfully closed its second issue of covered bond for Rs. 75 crores. The issue is yet another milestone in InCred’s diversified liability strategy.
The deal recorded strong participation from investors across the spectrum – family offices, ultra HNIs, corporate treasuries and other NBFCs. This covered bond issue is a first of its kind in the Indian market – with the underlying loans selected from InCred’s Personal Loans (PL) portfolio. The transaction structuring was done entirely in-house, unlike most other structured debt issues in the market.
The issue carries a rating of ‘PP-MLD CRISIL AA+r (CE)/Stable’ indicating a high degree of safety with regard to timely servicing and low credit risk. The issuance has a call option at the end of 21 months and the pricing offered is a tight 9.15% (XIRR basis).
Talking about the development, Vivek Bansal, CFO – InCred, said, “It is a huge milestone for us in the diversified liability strategy. This positions InCred well as we continue our focus on funding diversification and innovation to support our asset growth trajectory.”
Covered bonds are a relatively new asset class in the Indian capital markets context with a market size of Rs. 2,200 crores in FY21. It is likely to see strong growth in the coming years.