SBI board approves raising up to ₹20,000 crore via long-term bonds in FY25

State Bank of India, the country's largest public sector bank, announced on Wednesday, June 19, that its board has approved a plan to raise up to ₹20,000 crore through long-term bonds in the financial year 2024-25.

“The Central Board at its meeting held today i.e. 19th June 2024 has, inter alia, accorded approval for raising long term bonds up to an amount of Rs. 20,000 crore through a public issue or private placement, during FY25," the company said in an exchange filing.

In January, SBI raised ₹5,000 crore through perpetual bonds at a coupon rate of 8.34 per cent. In the previous financial year, the bank raised a total of ₹20,000 crore by issuing 15-year infrastructure bonds.

Earlier this month, SBI also raised $100 million through its London branch by selling three-year senior unsecured floating-rate bonds, priced at a spread of 95 basis points above the secured overnight financing rate (SOFR).

Indian banks have been bolstering their capital base to meet the increasing demand for loans. Several state-run lenders, including Canara Bank and Punjab National Bank, plan to raise funds through debt issuance this fiscal year.

Last week, SBI also approved raising $3 billion through a public offer or private placement of senior unsecured notes in U.S. dollars or other major foreign currencies.

After announcing the new bond issuance plan, SBI's shares were trading up by 0.22% at ₹846.45 each on the BSE.

(With inputs from Reuters)