Fullerton India on Monday said, “It has successfully raised ₹2,795 Crores ($ 350 mn), through the external commercial borrowing (ECB) route.”
The Company has raised the loan at a margin of 122 basis points over the SOFR (Secured Overnight Financing Rate) for a tenor of 5 years from Sumitomo Mitsui Banking Corporation (SMBC) Singapore via the parent route.
The long tenure of the facility benefits the overall Asset Liability Management of the company.
The past year has been transformative for the company as it became a consolidated subsidiary of Japan’s Sumitomo Mitsui Financial Group (SMFG), with SMFG acquiring a 74.9% stake from Fullerton Financial Holdings (FFH). SMFG will eventually acquire a 100% stake.
Speaking on the fundraise, Shantanu Mitra, MD & CEO of Fullerton India, said, “Our FY22 performance echoes our deep commitment to innovate and serve each one of our customers with unique loan offerings, so they can fulfill their financing needs. This funding is fully hedged for foreign currency risks, and it is almost equivalent to the domestic cost of borrowing.”
“The current ECB raised will enable us to diversify our funding base and tap offshore markets to fund future growth plans of the company,” he added.
Over the last few years, Fullerton India has raised funds from various institutions like Asian Development Bank (ADB), International Finance Corporation (IFC), and major Banks in India.
Commenting on the funding round, Nobuyuki Kawabata, Senior Managing Executive Officer, Sumitomo Mitsui Financial Group & Chairman of Fullerton India said, “This transaction reinforces our commitment towards Fullerton India. We believe this lending will play an important role to promote inclusive growth in line with our long-term strategy for India. SMFG is committed to supporting the growth plan of Fullerton India by leveraging its global relationship and providing funding support.”