SBI to raise $1 bn via bonds

The State Bank of India (SBI), the country’s largest lender, on Friday said it was planning to raise about $1 billion (Rs 4,500 crore) from overseas markets in the next financial year. The funds will be raised through bonds to support the state-owned bank’s growth plans next year.

“The issue could be (worth) around $1 billion. We will do that at an appropriate time, depending upon the market conditions and our requirements,” Chairman O P Bhatt said on the sidelines of the Skoch summit.

Bhatt said the amount would be raised in one go, like the bank did in the past.

On interest rates, Bhatt said the bank was not likely to raise rates in the current financial year. He said credit offtake is relatively low in the first quarter of a financial year and unless there was significant growth in credit demand, lending rates were unlikely to rise in the next few months.

“There is a general upward bias in the interest rates in general. There has been more impact of it on deposit rates because liquidity was tight and everybody was preparing for the quarter-end surge which takes place. It has been less on the loan side so that bias continues but regardless of that my own sense is that in the next few months lending rate is not going to be increased,” he added.

In its mid-quarterly policy review on March 17, the Reserve Bank of India had increased repo rate and reverse repo rate by 25 basis points.

Source: Business Standard