SBI flags off QIP to raise Rs 11,000 crore

The State Bank of India (SBI), the country’s largest lender, has launched share sales through private placement to raise about Rs 11,000 crore to shore up its capital adequacy ratio.

This is part of the plan to mop up Rs 15,000 crore from the markets in the current fiscal year.

In a regulatory filing, the bank said it had opened a “qualified institutional placement” (QIP) of equity shares with a face value of Rs 1 to qualified institutional buyers.

“The floor price in respect of the issue, based on the pricing formula of Sebi, is Rs 287.58 per equity share of the bank and the relevant date for this purpose...is June 5, 2017,” the filing said.

It further said the bank might offer a discount of not more than 5 per cent to the floor price. According to sources, the SBI plans to raise Rs 11,000 crore through this QIP.

In March, the central board of the bank had approved raising equity capital of up to Rs 15,000 crore during 2017-18.

The board had permitted the bank to raise funds by way of a follow-on public offer (FPO), rights issue, QIP, American Depository Receipts (ADRs), Global Depository Receipts (GDRs), or employee stock options.

The bank's stock closed at Rs 287.35, down 0.02 per cent, on the BSE.

On a consolidated basis, its deposits stood at Rs 25,99,811 crore and its net advances were at Rs 18,96,887 crore at the end of March.