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HDFC Credila raises $100 million via ECB to diversify funding resources

HDFC Credila, an erstwhile subsidiary of HDFC Limited (now HDFC Bank), focuses on the education loans business

HDFC Credila

HDFC Credila

Aathira Varier Mumbai

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Non-Banking Financial Company (NBFC) HDFC Credila has raised $100 million through External Commercial Borrowing (ECB), which will be used to diversify its funding resources and strengthen its position in the education finance sector.

DBS Bank was the lead arranger and book runner for the loan. It acted as the exclusive structurer and arranger of the transaction, leading the end-to-end market scoping, credit analysis, due diligence, transaction structuring, and execution as a part of the deal process.

“DBS Bank has led a syndicated External Commercial Borrowing loan for HDFC Credila Financial Services Limited through the DBS IFSC banking unit in Gujarat International Finance Tec-City (GIFT City). As the sole mandated lead arranger and book-runner, DBS Bank completed a $100 million transaction, which will support HDFC Credila’s growing retail education loan franchise,” a press release from DBS stated.

HDFC Credila, an erstwhile subsidiary of HDFC Limited (now HDFC Bank), focuses on the education loans business. Last month, HDFC Bank concluded the sale of a 90 per cent stake in HDFC Credila to private-equity firms BPEA EQT and Chrys Capital for Rs 9,553 crore.

Arijit Sanyal, Managing Director and Chief Executive Officer of HDFC Credila, said, "HDFC Credila looks to borrow funds from diversified sources at competitive rates, which, in turn, allows us to continue offering competitive education finance products to aspiring students. We are pleased to have concluded a $100 million ECB transaction with DBS Bank as the lead arranger and appreciate the strong support demonstrated by DBS. As market leaders in the education finance domain, these funds will help us support growth and thereby strengthen our position."

HDFC Bank sold its stake in the education financing NBFC in order to meet the regulatory requirements that were mandated prior to the merger with Housing Development Finance Corporation (HDFC).

Rajat Verma, Managing Director and Head of Institutional Banking Group at DBS Bank India, said, "With the demand for education loans gathering pace, HDFC Credila is poised to play an important role in nurturing the country’s talent by enabling access to learning for India’s students. In line with our focus on responsible banking, DBS is proud to support HDFC Credila, the country’s leading education loan company as they empower youth to be future ready."

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First Published: Apr 09 2024 | 8:05 PM IST

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