Axis Bank raises $500 million in offshore loan from MUFG

, India’s third-largest private lender, has signed a $500 million with , according to people familiar with the matter, underscoring rising demand for .

The three-year facility will be priced based on the (SOFR) plus 85-basis point interest margin, the people said, asking not to be identified as the details are private. The bank plans to use the funds for and general business purposes, they said.

The loan is now being syndicated to a broader group of lenders, the people said.

Also Read:

The fundraising comes at a time when banks in India are facing challenges because loans are growing significantly faster than deposits. For instance, Axis Bank’s loans expanded 19% to 12.3 trillion rupees ($130 billion) in the year ended March, while its deposits grew by only 14%, according to its data.

has secured the , with MUFG acting as the sole mandated lead arranger and bookrunner, Girish Vasnani, director in the capital markets group at the Japanese lender, said by email.

Axis Bank did not immediately reply to request for comment.