ICICI's last bond issue was priced 50 basis points less than the yield of the current issue. The latest ICICI offering carries a semi-annualised yield of 13.72 per cent. ICICIis expecting to mop up over Rs 200 crore through the on-tap issue which opened on June 20. It will close on June 30.

ICICI's investment banking arm, I-Sec, and the non-banking financial company, I-Credit, are the lead arrangers of the issue. "So far we have received a good response from the market. Through this on-tap issue, we are expecting to garner more than Rs 200 crore," an I-Sec source said.

According to him, ICICI is targeting provident fund and cooperative banks for mopping up Rs 200 crore. The minimum size of investment to be made in the seven-year bond issue is Rs 50 lakh. "Provident funds arelapping up the instrument," said a market source. Market experts feel that major insurancefirms and its armsand MFs will find this instrument an attractive investment option.

A five-year ICICI paper has been in the market since the beginning of June. The paper carries a coupon of 13.75 per cent. Besides, ICICI has recently hit the market with a preference share issue to raise Rs 300 crore.

The private placement market is currently very active as almost all FIs andfirms are raising funds via this route. With ECBs now becoming prohibitively expensive following the Moody's downgrade, there will be further pressure on the private placement market, sources said. IFCI recently entered the private placement market with a Rs 500 crore bond issue offering 14 per cent on a seven-year regular return bond. The coupon on the 5-year regular return bond has been kept at 13.75 per cent.