Active Development AidData Chinese Aid

Bank of China contributes $43 million to syndicated loan for Housing Development Finance Corporation for on-lending purposes

$43M USD

Funder	Bank of China (BOC)
Recipient Organization	Housing Development Finance Corporation
Country	India
Start Date	May 22, 2023
End Date	May 07, 2029
Duration	2,177 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`105442`

Grant Description

Bank of China contributes to USD 750 million syndicated loan for Housing Development Finance Corporation for on-lending purposes in India in 2023 On May 22, 2023, Housing Development Finance Corporation (HDFC), a leading Indian mortgage finance company, signed a $750 million syndicated social term loan facility with a consortium of 15 international banks.

The facility, which is unsecured and carries a five-year maturity, is priced at the Secured Overnight Financing Rate (SOFR) plus a 1.12% margin.

The transaction reflects HDFC’s ongoing strategy to mobilize global capital to fund socially beneficial initiatives and support inclusive growth in India.

The facility includes four Mandated Lead Arrangers and Bookrunners (MLABs): MUFG Bank, GIFT branch, which committed $200 million; DBS Bank, with a $95 million allocation; CTBC Bank, contributing $80 million; and Taipei Fubon Commercial Bank Co, also contributing $80 million.

In addition, Bank of Baroda, New York Branch; Bank of China, Singapore Branch; and National Bank of Kuwait, Singapore Branch served as Mandated Lead Arrangers, each committing $80 million, $43 million, and $43 million respectively.

The remaining participants, classified as Arrangers, include E.Sun Commercial Bank, Singapore Branch; Land Bank of Taiwan; Taichung Commercial Bank Co, Labuan Branch; Taiwan Business Bank, Offshore Banking Branch (OBU); Taiwan Cooperative Bank, OBU; Hua Nan Commercial Bank, OBU; and Chang Hwa Commercial Bank, OBU, with allocations ranging from $10 million to $19 million.

Chugoku Bank, Hong Kong Branch was also a participant in the syndicate. The facility agreement was signed on May 22, 2023, and the loan was fully pre-funded by the MLABs on May 30, 2023. The syndication agreement with the remaining participants was finalized on July 28, 2023. Legal counsel to the lenders included Baker & McKenzie Wong & Leow for English law and AZB & Partners for Indian law.

The proceeds from this loan are earmarked for financing eligible assets under HDFC’s Social Financing Framework, which focuses on projects that generate positive social outcomes, particularly in affordable housing.

This aligns with HDFC’s broader mission to support the expansion of homeownership for low- and middle-income populations in India, as well as investments in other socially impactful sectors such as education and healthcare.

This transaction represents a growing investor appetite for ESG-linked financial instruments and underscores HDFC’s role as a key facilitator of sustainable development in India.

The participation of a diverse mix of Asian and global financial institutions further highlights the cross-border commitment to advancing socially responsible lending.

📋 Staff Comments

Housing Development Finance Corporation (HDFC) was an Indian private sector mortgage lender based in Mumbai. HDFC was the largest housing financing company in India in terms of assets of about $133 billion as of March 31, 2023. The main business of HDFC was to provide developers, corporates and individuals financing for the purchase, construction, development and repair of properties. In July 2023, HDFC merged with HDFC Bank, the country's largest private sector bank, in a bid to expand its portfolio and to gain access to a larger customer base. After the merger, the borrower of the facility was changed to HDFC Bank.
Legal advisers to lenders - Baker & McKenzie. Wong & Leow - English law AZB & Partners - Indian law.
AidData has estimated the loan's all-in interest rate -- at the time it was issued -- by adding 1.12% to average SOFR in May 2023 (5.02%).

📚 Sources & References

HDFC Seals 750M Deal Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.