ICICI, country's largest private sector bank, is considering raising funds for its overseas branches via five year dollar denominated senior unsecured notes through its Bahrain branch.

However, the bond issue does not form a part of bank's $5-billion medium term note programme. Investment banking sources say that ICICI has set price guidance of about 350 basis points over US treasuries for bonds maturing in march 2010.

The bond issue is rated BBB- by Standard & Poor's and BAA2 by Moody's Investor service.

The issue is being managed by Bank of America-Merill Lynch, HSBC Securities and Credit Suisse.

An ICICI spokesperson said, "ICICI Bank is raising long-term funds for meeting business requirements of its overseas branches, including for financing of existing loan book and meeting growth opportunities. The end use of the funds would be in the bank's overseas branches."

ICICI is supposed to meet investors in the US and UK to measure investor appetite for its Medium term note program.

Bankers say that SBI bond issue would act as a benchmark for other banks. Axis bank, country's third largest private sector bank has also announced its plan to mobilize up to $500 million from international markets.