Yes Bank, two other peers withdraw dollar debt plan, bankers say

According to Business Recorder, citing three merchant bankers, India's Yes Bank has abandoned a plan to raise U.S. dollar debt because investors wanted higher yields. The lender, which is 24.9% owned by Japan's Sumitomo Mitsui Banking Corp, had aimed to borrow about $500 million through three-year bonds and had hired bankers for the issue the previous week. According to the bankers, buyers wanted a margin of 200 basis points over Treasuries.

One banker linked the rush to the central bank bringing forward the close of its discounted dollar deposit window, which left investors asking for 30-40 basis points more than usual. Lenders are racing to complete such sales, since most proceeds are expected to fund customer leverage for deposits under the Reserve Bank of India's scheme, and hedging on those deposits ends on August 31.

Federal Bank and RBL Bank have also shelved similar $500 million benchmark issues, the bankers said, and neither lender responded to Reuters emails requesting comment. One banker added that there is too little time for public disclosures and private placements have become costly, so holding borrowings for now makes sense.