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SBI to tap overseas bond market again, eyes $1.5 billion in dollar debt

LiveMint logoLiveMint 21-03-2017 PTI

Mumbai: The State Bank of India (SBI) has said it will be hitting the overseas debt market with a $1.5 billion dollar bond sale next financial year.

The SBI, which has a board approval to raise Rs15,000 crore through multiple routes, however, did not specify when it will tap the dollar bond market. It can be noted that in last June the bank had informed the exchanges about its plans to raise a similar amount in dollar money, but did not proceed with the plan.

In a BSE filing, the bank said its “executive committee of the central board will meet on 24 March to examine the issuance of RegS bonds worth $1.5 billion for a tenor not exceeding 5.5 years in fiscal 2018.”

The board meeting will also finalise issuance of equity shares to the shareholders of three of its listed subsidiaries, which will be merged with it along with two other unlisted associates, from 1 April, the filing said.

The three listed associate banks are State Bank of Travancore, State Bank of Mysore and State Bank of Jaipur & Bikaner, while the two unlisted ones are State Bank of Hyderabad and State Bank of Patila.

Today, the government said the Bharatiya Mahila Bank will also be merged with SBI over the next three months. After a long gap, SBI had tapped the overseas debt market late January and had raised $500 million in a five- year dollar bond sale.

The drawdown was carried out through its London branch, and are now traded on Singapore Exchange. This bond sale was part of the nation’s largest lender’s $10-billion medium-term notes programme. Before this, SBI had raised $300 million last September and prior to that in February 2014, it had raised $1.25 billion in US dollar debt.

The bank has so far raised $3.5 billion out of its $10 billion MTN programme, including $400 million in perpetual bonds. The bank had also concluded AT1 Basel III-compliant non-convertible, perpetual non-call five-year subordinated, unsecured notes at a coupon 5.5% payable semi-annually under $10 billion RegS bond programme.

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