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Key Points

SBI has set a floor price of Rs 811.05 per share for its Rs 20,000 crore bond issue to boost capital. The bank also plans to raise up to Rs 25,000 crore in FY26 through QIP or FPO. Six major investment banks, including Morgan Stanley and HSBC, will manage the process. The move aims to strengthen SBI’s financial position amid its 70th-anniversary milestone.

Key Points: SBI Sets Rs 811.05 Floor Price for Rs 20,000 Crore Bond Issue

  • SBI board approves Rs 20,000 crore bond issue at Rs 811.05 floor price
  • Bonds aim to strengthen Basel III-compliant capital base
  • Six investment banks to oversee QIP process
  • Government stake may dilute from current 57.43%
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SBI sets floor price at Rs 811.05 for its Rs 20,000 crore bonds

SBI announces Rs 20,000 crore bond issue at Rs 811.05 floor price to strengthen capital base, with board approval for FY26 fundraising.

"The goal is to increase SBI’s Common Equity Tier 1 (CET1) capital ratio. – SBI Board"

New Delhi, July 16

State Bank of India (SBI), the country's largest public sector lender, on Wednesday set the floor price at Rs 811.05 per equity share for its Rs 20,000 crore bonds.

The board director of the bank approved the proposal to raise the amount through issuing bonds to domestic investors.

The issue's subscription period began on Wednesday after the bank's board of directors approved the fundraising during a meeting on Wednesday, the public sector lender informed exchanges.

The floor price is 2.3 per cent less than the closing price of SBI shares on the BSE on Wednesday. The scrip settled at Rs 831.55, up 1.81 per cent from the previous close.

The biggest lender in India confirmed in a separate regulatory filing that the Central Board authorised the issuance of ‘Basel III-compliant Additional Tier 1 and Tier 2 bonds’ with a maximum value of Rs 20,000 crore for the current fiscal.

Subject to any required government approvals, these bonds will be issued to domestic investors in Indian rupees. The goal of the action is to increase the nation's biggest bank's capital base.

The SBI board approved raising to Rs 25,000 crore in equity capital for FY26 earlier this year in May.

Qualified Institutional Placement (QIP), Follow-On Public Offer (FPO), or other approved means will be used to raise the capital in one or more tranches.

In order to strengthen the bank's financial standing, the goal is to increase SBI's Common Equity Tier 1 (CET1) capital ratio.

The government's stake, which was 57.43 per cent as of March 31, will be diluted as a result of the proposed QIP.

Six well-known investment banks have been chosen by SBI to oversee the QIP process: ICICI Securities Ltd, Kotak Investment Banking, Morgan Stanley, SBI Capital Markets Ltd, Citigroup, and HSBC Holdings Plc.

For the fiscal year 2024-2025, SBI previously sent the government a dividend cheque of Rs 8,076.84 crore.

For the fiscal year 2024-2025, the public sector bank's net profit soared to Rs 70,901 crore.

The bank is commemorating its 70th year of existence with a balance sheet that has increased to Rs 66 lakh crore and a customer base that has surpassed an incredible 52 crore.

- IANS

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Reader Comments

P
Priya S
I wish SBI would focus more on improving customer service while raising funds. Their digital banking still lags behind private banks. Good financials mean nothing if customers face issues daily.
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Rohit P
₹20,000 crore is huge! But with 52 crore customers, SBI is truly the people's bank. Proud to see our national bank growing so strong. Hope they use this money to expand rural banking services too.
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Sarah B
Interesting to see global banks like HSBC and Citigroup involved. Shows SBI's growing international credibility. The Basel III compliance is a good sign for risk management standards.
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Karthik V
Government stake dilution to 57.43% is concerning. SBI should remain majority government-owned to maintain its public service character. Hope they don't become like private banks chasing only profits.
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Nisha Z
₹70,901 crore profit! 😲 That's more than many state budgets. Shows how strong our banking sector is. But hope they pass some benefits to customers through lower loan rates.
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Michael C
The selection of ICICI Securities and Kotak for QIP shows healthy competition in India's banking sector. Good to see domestic investment banks getting big mandates alongside global players.

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