New Delhi: State Bank of India (SBI), the country’s largest lender, has announced that it has raised Rs 5,000 crore through its second Basel III compliant Additional Tier 1 bond issuance for the current financial year at a coupon rate of 8.34%.
The tenor of this bonds is perpetual with a call option after 10 years and every anniversary thereafter.
"The issue attracted overwhelming response from a wide range of investors with 108 bids of Rs. 5,294 crores and was oversubscribed by about 2.65 times against the base issue size of Rs 2,000 crores. The investors were across mutual funds, provident & pension funds, banks, insurance companies, etc," SBI said in a release.
“The tight pricing and the diverse investor base for an instrument which has its own challenges shows the trust investors place in the Bank,” Dinesh Khara, Chairman SBI said.
Based on the response, the Bank has decided to accept bids of Rs. 5,000 crores at a coupon rate of 8.34% payable annually, added SBI.
The Bonds were rated AA+ with stable outlook by CRISIL and ICRA. The issuance is significant as the Bank has been able to diversify and raise long-term non-equity regulatory capital.
