SBI Triumphantly Secures INR 5,000 Crores in Second Basel III Compliant Bond Issuance

SBI Triumphantly Secures INR 5,000 Crores in Second Basel III Compliant Bond Issuance

India’s Banking Behemoth Raises Capital with Impressive Investor Confidence

State Bank of India (SBI), the country’s leading financial institution, has achieved a remarkable feat by raising INR 5,000 crores through its second Basel III compliant Additional Tier 1 bond issuance for the current financial year. This accomplishment underscores SBI’s financial prowess and reinforces investor trust in the bank’s stability and growth trajectory.

Key Highlights of the Issuance:

• INR 5,000 Crores Raised: SBI successfully secured the targeted amount through the bond issuance, demonstrating its strong market presence and ability to attract capital.
• Perpetual Bonds with Call Option: The bonds carry a perpetual tenure, providing long-term funding for the bank, with a call option after 10 years and every anniversary thereafter.
• Competitive Coupon Rate of 8.34%: The bonds offer an attractive interest rate, making them appealing to a wide range of investors.
• Overwhelming Investor Response: The issuance was met with enthusiastic participation, receiving 108 bids totaling INR 5,294 crores, reflecting a 2.65 times oversubscription compared to the base issue size of INR 2,000 crores.
• Diversified Investor Base: The oversubscription was fueled by interest from a diverse pool of investors, including mutual funds, provident and pension funds, banks, and insurance companies. This signifies strong confidence in SBI’s financial standing and future prospects.
• Creditworthiness Affirmed: CRISIL and ICRA have assigned the bonds an AA+ rating with a stable outlook, validating the robustness of the issuance and SBI’s creditworthiness.
• Strategic Move for Long-Term Growth: This capital raise allows SBI to diversify its funding sources and strengthen its capital adequacy ratio, enabling it to pursue long-term growth plans and solidify its position as a leading financial player in India.

SBI’s successful bond issuance is a testament to its financial strength, strategic vision, and ability to navigate the market with confidence. This achievement paves the way for further growth and reinforces SBI’s commitment to supporting India’s economic development.