Shriram Finance secures record syndicated loan in global markets

Shriram Finance Limited (SFL), the flagship entity of the esteemed Shriram Group, has successfully concluded a monumental fundraising venture, amassing a total of USD 425 million and EUR 40 million through a syndicated term loan transaction. This achievement not only represents the largest syndicated loan for a private non-banking financial company (NBFC) from India in recent years but also marks a historic milestone as Shriram Finance’s largest syndication to date.

The transaction was structured as a three-year External Commercial Borrowing (ECB) facility, labeled as a Social Loan, with BNP Paribas, DBS Bank, Hongkong & Shanghai Banking Corporation (HSBC), and Sumitomo Mitsui Banking Corporation (SMBC) serving as joint Mandated Lead Arrangers & Bookrunners and Social Loan Coordinators. The deal initially set out to raise USD 200 million but expanded significantly due to overwhelming interest from the syndication market, eventually involving 16 lenders from four continents—Europe, the US, Asia, and Africa.

This robust participation underscores the strong confidence lenders have in Shriram Finance’s financial stability and innovative business model, which focuses on providing a wide array of credit solutions including commercial vehicle loans, two-wheeler loans, and housing finance among others.

Umesh Revankar, Executive Vice Chairman of Shriram Finance Limited, expressed his enthusiasm about the transaction: “We are thrilled by the robust participation from lenders across geographies for our External Commercial Borrowings. This marks the largest syndicated multi-currency transaction by a private sector Non-Banking Finance Company. This facility is labelled as a Social loan, reflecting our commitment to social impact similar to our priority sector initiatives, with certain strict exclusions.”

Rajat Verma, Managing Director and Head of Institutional Banking Group at DBS Bank India, highlighted the alignment with responsible banking practices: “DBS Bank is proud to have facilitated this landmark social loan and of playing a key role in enabling it to become the largest syndicated transaction for Shriram Finance Limited. We believe these opportunities are a way for businesses to do well by doing good and are purposeful in their intention to not only drive economic growth but also enhance financial inclusivity.”

The funds from this loan are earmarked for empowering small entrepreneurs and vulnerable groups across India, enhancing Shriram’s mission to increase financial accessibility to the unbanked and underbanked sectors.

This strategic financing move by Shriram Finance not only fortifies its position in the international financial landscape but also propels its commitment towards generating impactful social outcomes through its financial services.