SBI raises Rs 3,000-crore from bonds to fund business growth

The country's largest lender State Bank of India (SBI) on Friday said it has raised Rs 3,000 crore from bonds to fund business growth.

The bank on Thursday issued 30,000, Basel III compliant, Tier-ll bonds, in the nature of debentures, with the face value of Rs 10 lakh each at par, SBI said in a statement.

Bonds with 10 years maturity will give 8.45% annually to investors who have subscribed to such bonds on private placement basis, it said. They come with call option of five years. The bank through these bonds raised Rs 3,000 crore, it said.

Recently, SBI got board approval to raise Rs 15,000 crore by various means, including public offer and overseas issuance of shares, in the next 14 months.

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The fund raised will help the bank to meet global risk norms, Basel III, which will kick in from March 2019.

The committee of directors, at January 15 meeting, authorised the bank to seek shareholders' approval and to write to the Government of India and the Reserve Bank of India (RBI) seeking their approval for extending the period of approval for raising capital up to Rs 15,000 crore till March 2017, SBI had said.

The fund would be raised either through follow on public (FPO) issue, qualified institutional placement (QIP), rights issue, private placement, Global Depository Receipt (GDR), American Depository Receipt (ADR) or a combination of these, it had said.  

At 1353 hours, the shares of State Bank of India were trading up 2.51% or Rs 4.00 at Rs 163.55 per scrip on the BSE.