SBI rights issue this fiscal: Chaudhuri

Country's largest lender State Bank of India (SBI) today said it would come out with the rights issue this fiscal, but maintained that it was well capitalised for FY12 in case the government delays go-ahead to the Rs 21,000-crore issue.

"The government is very positive and actively considering the rights issue. It will come out in this fiscal. We are in the second quarter, [it may come] may be in the third or fourth quarter," SBI Chairman Pratip Chaudhuri told reporters on the sidelines of a Ficci-IBA event here.

The bank has been trying to shore up capital through the Rs 21,000-crore rights issue since February last year. But the government has not given the go-ahead so far and, considering the tight finances of the Central Exchequer, it is has been speculated that it may not happen this fiscal either.

The government has not earmarked any money in the budget for this purpose this year. Since the Centre holds 59.4% stake in the bank, it will have to shell out over Rs 12,000 crore for the rights issue, or issue bonds as it had done last time the bank came out with a rights issue.

However, when asked about the bank's capital adequacy and if it can achieve its targeted 16-19% credit growth with the current reserves this fiscal, Chaudhuri said, "Yes, total capital adequacy of ours is 11.60%. Even if we have 20% [credit] growth, it will be all right."

On whether the bank can see through the year without the funds from the rights issue coming in, he said, "Yeah..We are well capitalised for this year."

Earlier in the day, SBI Managing Director and Chief Financial Officer Diwakar Gupta had said the bank can manage without the rights issue this fiscal by depending on other routes of capital augmentation like retail bonds.