SBI to raise up to Rs 12,000 crore by issuing tier-II bonds

Country's largest lender State Bank of India (SBI) on Monday said it plans to raise up to Rs 12,000 crore by issuing tier-II bonds on private placement basis.

The Committee of Directors' has authorised the bank to raise up to Rs 12,000 crore by way of "issue of Basel III compliant Tier-II bonds, at par, through private placement", SBI said in a filing to the BSE.

SBI said the amount may be raised in a single or more tranches and the coupon rate on the bonds may be decided at the time to actual issuance.

According to a Fitch Ratings report, Indian banks need $140 billion capital to ensure full compliance with the Basel III norms by 2018-19. The Basel III norms are aimed at bolstering banks' resilience. 

Basel III capital regulations are being implemented in India with effect from April 1, 2013 in a phased manner.