SBI to raise Rs 18,000 cr via bonds by March 2010

State Bank of India (SBI), the country's largest lender, today said it would raise Rs 18,000 crore from bonds by March 2010 in order to meet its capital requirement and fuel business growth.

The bank is planning to raise unsecured and rated Rupee Innovative Perpetual Debt Instruments, upper Tier or Lower Tier II subordinated debt during the remaining part of 2008-09 and 2009-10, SBI said in a filling to the National Stock Exchange.

The fund not exceeding Rs 18,000 crore would be raised in tranches with a minimum maturity of over 60 months as per the RBI guidelines through structured deals or by private placement, it said.

 

The money raised from bonds could take the Capital Adequacy Ratio (CAR) under Basel II well above 14 per cent, SBI Chairman O P Bhatt had said while declaring second quarter results of the bank.

As of September, the CAR of the bank as per Basel I norms was 12.14 per cent while as per Basel II norms it stood at 11.51 per cent.

SBI posted 40 per cent growth in net profit for the second quarter of this fiscal on high interest income. It recorded a net profit of Rs 2,259.72 crore for the quarter as compared to Rs 1,611.42 crore a year ago.

The total income rose to Rs 17,909.64 crore in the second quarter from Rs 13,658.22 crore a year ago, up by 31 per cent.

On the consolidated basis, SBI posted a 11.50 per cent rise in its net profit at Rs 2,458.04 crore for the second quarter ended September 30.

Shares of the bank were trading at Rs 1,220, up by 1.27 per cent on the National Stock Exchange today.