IDBI Bank has plans to ra­ise capital worth $1 billion by August 2012 through foreign currency borrowing. While the most part of it will come in US dollar or dollar equivalent currency, there will be come portion in Sw­iss Fra­nc as well, RM Malla, CMD, IDBI Bank said in Ko­lkata on Monday.

IDBI executive director RK Bansal later explained that it will be a mix of vario­us instruments such as MTN, syndicated loan, sho­rt-term loan and so on. The bank has already raised $0.5 billion through foreign currency borrowing. It has also completed a tier-II capital raising of Rs 900 crore.

The government had in­f­used Rs 3,011 crore again­st 25 per cent shares and till March, 2012, the bank does not require any more mon­ey from the government, Malla said.

The bank has got in-pri­nciple approval from the ADB for raising $300-$350 million worth bonds under latter’s credit guarantee sc­heme. “The formal appro­v­al is expected any day now,” said Malla. He said the bo­nds will be privately placed but carry a partial guarantee (50-60 per cent) of the ADB, which in turn, will reduce the bank’s fund raising costs. These will be issued in the Asian region and will mostly be for the SME sector. The process is expected to be completed by March 2012.

IDBI Bank’s SME sector lending has been phenomenal, the CMD said, adding that while the national average in this respect has been 20 per cent, in IDBI’s case it has been much higher. Its SME sector lending has in fact grown from Rs 6,000 crore in the last to last financial year to Rs 11,000 crore in the last fiscal.