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SBI launches Rs2,000-cr retail bond issue from Monday

SBI launches Rs2,000-cr retail bond issue from Monday
PTI
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First Published: Fri, Feb 18 2011. 06 32 PM IST
Updated: Fri, Feb 18 2011. 06 32 PM IST
Mumbai: The nation’s largest lender State Bank on Friday announced the launch of a Rs2,000-crore retail bond issue from Monday to shore up its Tier II capital.
“Following the huge success of our maiden retail bond issue last October, which was snapped up 19 times, we are happy to launch another issue with a better yield from Monday. The issue is part of our planned Rs10,000-crore retail bond issue. We will be looking forward to going to the market every quarter,” Chairman of the bank Omprakash Bhatt told reporters here today.
Chief financial officer of the bank Hemant Contractor said these Lower Tier II bonds are being issued in two series- Series 3 and Series 4.
Series 3 bonds have a tenor of 10 years with a call option by SBI after five years and a coupon rate of 9.75% per annum for retail and 9.30% for non-retail applicants.
Series 4 bonds have a tenor of 15 years and a coupon rate of 9.95% for retail and 9.45% for non-retail investors.
These bonds will be distributed through 126 branches spanning 79 centres and will be open to only those with demat accounts. The issue opening on 21 February will close on 28 February.
Contractor further informed that the bond issue will not be redeemable at the option of bond holders or without prior RBI permission.
The bond issue is of Rs1,000 crore with the option to increase the issue size by a similar quantum if the market condition demands it, he said.
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First Published: Fri, Feb 18 2011. 06 32 PM IST