Mumbai: Public sector oil major Indian Oil Corporation has tied up with Standard Chartered Bank to mobilise Rs 400 crore from the overseas market. StanChart is the book-runner, lead arranger and the facility agent, and Union Bank of India is the joint arranger for this loan syndication of IOC.

The proposed Rs 400-crore issue is structured on the lines of foreign currency syndicated loan transactions in the overseas markets. The facility will be governed by a uniform pricing benchmark and have common documentation for all lenders. The amount would be raised by way of a one-year, unsecured, term-loan facility. The interest rate will be benchmarked to the three-month commercial paper reference rate and will be payable and reset quarterly. The interest payments will be at a margin of 10-to-25 basis point over the three-month commercial paper reference rate. The final cut-off margin will be determined on a book-building basis. The facility benchmark rate has a floor rate of 7.5 per cent per annum and a cap of 12.5 per cent per annum.

RBI''s deregulation of sub-prime rate lending by banks in the April 2001 credit policy has thrown up new fund raising opportunities for corporate borrowers, thereby providing alternate lending mechanisms to banks.

For the quarter ending June 2001, Prime Database, Indias leading capital market information service provider, has ranked StanChart Bank in India as the No 1 arranger for private sector corporate debt on a private placement basis and as the No 4 arranger for all issues on a pro-rata basis.

StanChart is the largest international banking group in India having a combined customer base of 2.4 million in retail banking and over 1,200 corporate customers.