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Business News/ Market / Stock-market-news/  SBI raises $500 million in 3-year dollar debt
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SBI raises $500 million in 3-year dollar debt

With this, the SBI has raised $4 billion out of its $10 billion medium term notes plan, including $400 million in perpetual bonds last year

The medium term notes will be traded on the Singapore Stock Exchange. File photo: MintPremium
The medium term notes will be traded on the Singapore Stock Exchange. File photo: Mint

Mumbai: Nation’s largest lender State Bank of India on Thursday raised $500 million in forex debt in three-year dollar money as part of its medium term notes (MTN) programme, making it the second fund raising by it this year.

The RegS bond programme has been sold through its London branch and is priced at Libor plus 95 bps. A RegS or Regulation S issue means that under the US Securities Commission norms, the instrument will be denominated in the greenback, but resident Americans cannot buy into them.

“We have successfully concluded a benchmark bond sale, raising $500 million, priced at Libor plus 0.95%. The three-year money was drawn through our London branch," a senior bank official told

PTI. The notes will be traded on the Singapore Stock Exchange, the official added.

With this, the bank has raised $4 billion out of its $10 billion MTN plan, including $400 million in perpetual bonds last year. The bank is also in the process of raising Rs15,000 crore directly from the market next fiscal year through a clutch of instruments, including QIP, preferential issue among others, for which it has secured shareholder approval.

On 17 January this year, SBI had raised $500 million in a five-year dollar money sale, through its London branch and got listed on the Singapore Exchange. Before this, the bank had raised overseas debt by issuing $300 million in September 2016. Prior to that, it had raised $1.25 billion in another dollar money sale in February 2014.

Thursday’s bond sale is part of its immediate plans to raise $1.5 billion, the bank had informed the BSE on 20 March. Its board meeting on 24 March had cleared the plan.

All the three global rating agencies have rated the drawdown on par with the bank’s existing ratings, which again is aligned to the sovereign ratings. Moody’s has assigned a Baa3 rating to the US dollar denominated senior unsecured notes, issued under its $10 billion MTN programme. It has also given a positive outlook on the ratings.

SBI represents 16.3% of system loans and 17.6% of deposits as on end-March 2016, and government owns 60.18% in the bank. All these metrics will jump with the merger of five associate banks effective April, it said.

Another agency S&P in a note assigned ‘BBB-’ long-term issue rating to the issue. The rating on the notes reflects the long-term counterparty credit rating on SBI, it said.

Fitch also assigned BBB-/stable) rating to the senior unsecured debt, and said the instruments are rated at the same level as the bank’s issuer default rating. Under its long term fund raising plans, the bank has also concluded AT1 Basel III-compliant non-convertible, perpetual non-call five-year subordinated, unsecured notes at a coupon 5.5% payable semi-annually.

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Published: 30 Mar 2017, 08:22 PM IST
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