What Are Social Bonds?
Social bonds are financial instruments issued by governments, corporations, or international organizations to raise capital specifically for projects that will have a positive social impact. The funds raised are designated for social causes such as healthcare, education, poverty alleviation, and environmental sustainability.
NABARD's Inaugural Social Bonds
Step 1: Issuer
Q1: Who issued the social bonds?
A1: The National Bank for Agriculture and Rural Development (NABARD) is the issuer of the social bonds.
Step 2: Issue Date
Q2: When were the bonds issued?
A2: The bonds were issued on September 26, 2023.
Step 3: Bond Size
Q3: What is the total size of the issued bonds?
A3: The total size is Rs 1,040.50 crore.
Step 4: Unique Features
Q4: What makes these bonds special?
A4: These are India's first externally certified AAA-rated INR social bonds.
Step 5: Listing Location
Q5: Where will these bonds be listed?
A5: They will be listed on the Bombay Stock Exchange (BSE) on September 29, 2023.
Step 6: Redemption
Q6: What is the redemption date?
A6: The redemption date for these bonds is September 27, 2028.
Step 7: Holding Period & Coupon Payments
Q7: How long should the bonds be held and when are coupon payments made?
A7: The bonds should be held for a period of five years. Coupon payments will be made yearly.
Step 8: Face Value & Issue Size
Q8: What are the face value and issue size of the bonds?
A8: The face value of each bond is Rs 1,00,000. The base issue size is Rs 1,000 crore.
Step 9: Investor Response
Q9: How well were the bonds received by investors?
A9: The bonds saw an overwhelming response, with a total bid of Rs 8,590.50 crore.
Step 10: Credit Ratings
Q10: What credit ratings have these bonds received?
A10: These bonds have been rated AAA by CRISIL Ltd and ICRA Ltd.
Step 11: Purpose
Q11: Why were these bonds issued?
A11: These bonds aim to finance and refinance eligible green and social projects.
