SBI raises Rs. 4000 crore

State Bank of India (SBI), the country's largest lender, has raised Rs 4,000 crore of the Basel Compliant Additional Tier 1 (AT1) bonds on Wednesday at coupon rate of 7.72 per cent. This is the first AT1 Bond issuance in the domestic market post the new SEBI regulations. The issue attracted overwhelming response from investors with bids in excess of Rs. 10,000 crores received against a base issue size of Rs. 1,000 crores, which is an indicator of the trust the investors place on the country's largest Bank. This also very clearly demonstrates the maturity of the Indian investors in their selection of issuers for such instruments.

Based on the response, the Bank has decided to accept Rs. 4,000 crores at a coupon of 7.72%. This is the lowest pricing ever offered on such debt, issued by any Indian bank since the implementation of Basel III capital rules in 2013. The AT 1 instrument is perpetual in nature, however, it can be called back by the issuer after five years or any anniversary date thereafter.

While the Bank has MA credit rating from domestic credit rating agencies, the AT1 offering is rated AA+, which is the highest rating in the country for these instruments, in view of the hybrid and high-risk nature of these instruments.

Shares of State Bank Of India, was last trading in BSE at Rs. 429.7 as compared to the previous close of Rs. 426. The total number of shares traded during the day was 779955 in over 9810 trades.

The stock hit an intraday high of Rs. 432.5 and intraday low of 425.4. The net turnover during the day was Rs. 334926856.

Source : Equity Bulls

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