ICICI Bank plans to raise Rs 5,000 crore (Rs 50 billion) through long term bonds and has obtained highest safety rating "LAAA" from ICRA.
Even after the reverse merger of ICICI with ICICI Bank, the bank's top corporate exposure is in traditional sectors like power, iron and steel, telecom and textiles.
The country's second largest bank is raising bonds mainly to continue its term lending in these sectors.
In recent times, however, the bank has laid stress on retail lending. The retail portfolio was at Rs 19,132 crore (Rs 191.32 billion) last fiscal, official sources said in New Delhi on Monday.
ICICI earlier raised Rs 4,000 crore (Rs 40 billion) through certificate of deposits along with bonds, subordinate debts and fixed deposits.
ICRA has also retained highest safety ratings "A1+" on ICICI Bank's Rs 4,000 crore certificate of deposits along with "LAAA" and "MAAA" on subordinate debt, exiting bonds and term deposits, an ICRA release said.
"The rating takes into consideration the strong position of ICICI Bank in the Indian financial system as the second largest bank, low operating costs, extensive corporate relationships, increased retail exposure and stable profitability," it said.
ICICI Bank's interest spreads of 1.13 per cent till 2002-03, mainly on account of the high cost borrowing of erstwhile ICICI and declining interest rates are expected to improve in the near future, as the bank would replace the high cost debts with low cost deposits.