State Bank of India (SBI) on Thursday raised $600 million from selling dollar-denominated bonds to international investors at a coupon rate of 1.80 per cent.

The issue, subscribed 2.1 times, is part of the lender’s $10-billion medium-term note programme (MTN).

On Wednesday, rating agency Moody’s Investors Services had withdrawn the short-term foreign currency programme under MTN, citing business reasons.

In a statement, the bank said that its 5.5-year bond denominated in dollars was priced at 140 basis points over the US treasury. It added that this is the lowest pricing for any “Reg S/144a” issue from the country with such a maturity.

Regulation S bonds are sold by foreign issuers in the US and other overseas markets but cannot be subscribed by resident American investors.

The bonds issued through SBI’s London branch will be listed on Singapore Exchange and India INX, the country’s international exchange located at the International Financial Services Centre (IFSC) in Gujarat. India INX is a subsidiary of the BSE.

SBI disclosed that strong demand helped it tighten the pricing by 35 basis points from the initial guidance of 175-140 basis over the US treasury, arriving at a coupon of 1.80 per cent per annum, which is the lowest coupon achieved by a domestic issuer for a 5.5-year issuance to date.

This is the first public US dollar bond sale by a domestic bank since the onset of the pandemic last year.

The lender said the transaction was well received and saw strong interest from investors across geographies with a final order book of more than $1.9 billion.

Earlier this week, Exim Bank had raised $1 billion at a coupon of 2.25 per cent.

SBI shares closed with gains of 1 per cent at Rs 287.75 on the BSE on Thursday.