SBI board approves raising ₹7,000 crore through AT1 bonds

State Bank of India (SBI) on Monday said its central board has approved raising ₹7,000 crore in additional tier 1 (AT 1) capital.

“The central board at its meeting held today accorded approval to raise AT 1 capital up to an amount of ₹7,000 crore by way of issuance of Basel-III compliant debt instruments in rupee and or any other convertible currency through a public offer or private placement to overseas and or Indian investors (Dollar AT 1 or Masala AT 1) during FY20,” the bank said.

The bank said it shall obtain government’s concurrence in this regard. As of March 2019, the bank’s AT1 ratio stood at 1.03%, up from 0.97% in December 2018. Its total capital adequacy ratio was at 12.72% in FY19.

Meanwhile, the bank said that its board on 24 April has approved raising up to $2.5 billion (around ₹17,000 crore) through bonds in FY20. The bank said its board has approved “long term fund raising in single/multiple tranches up to $2.5 billion under Reg-S/144A, through a public offer and/or private placement of senior unsecured notes in US dollars or any other convertible currency during FY 2019-20″.

In January, SBI raised $1.25 billion through bonds from the overseas market. The bank said in a statement in January that it has concluded the standalone issuance of fixed rate senior unsecured notes in two tranches of $850 million for five years with a coupon of 4.375% and $400 million for three years with a coupon of 4%, payable semi-annually.

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