Mumbai: The country’s largest lender, State Bank of India (SBI), will raise Rs10,000 crore through bonds to augment its capital base to meet the growing business requirements.
SBI has filed a draft shelf prospectus with the Securities and Exchange Board of India (SEBI) seeking the nod of the regulator for raising funds through bonds in one or more tranches.
“The bank intends to deploy the issue proceeds to augment its capital base in line with its growth strategy,” SBI said in the prospectus filed on Monday.
The funds raised from the bonds will constitute SBI’s Lower Tier II capital, which include subordinated debt and convertible securities.
The bonds, according to the prospectus, have been assigned AAA ratings by the CARE and CRISIL, indicating highest safety with regard to timely payment of interest and principal.
As regards interest rate and tenor of bonds, the bank said it would be specified in the tranche prospectus for the issue for the particular series of bonds.
The bank is also awaiting Finance Ministry’s nod for raising Rs20,000 crore by offering additional equities to the existing shareholders to agument its lending operations.
The bank is India’s largest bank with 12,567 branches in India, 150 international offices in 32 countries and more than 155 million customer accounts as of June 30, 2010.
The bank also had deposits of over Rs8 lakh crore and total assets worth over Rs10.5 lakh crore.
SBI’s market share of aggregate deposits was 16.3% and of domestic advances was also 16.3% among all scheduled commercial banks in India as of 31 March, 2010.
The bank had reported a 13.45% rise in consolidated net profit to Rs3,806.49 crore for the quarter ended December, 2010.