State Bank of India priced one of the riskiest bank capital securities now at a record-low coupon in the latest sign.
India’s biggest bank will sell ₹4000 crore (approximately $545 million) of the so-called Additional Tier 1 bonds at a coupon of 7.74%. That’s the lowest pricing on such debt, which can be fully written down in a crisis, issued by any lender since the country started implementing the stringent Basel III capital rules in 2013.
The measures have also given investors confidence that the country’s lenders will be able to ramp up capital ratios in anticipation of more soured loans as the coronavirus batters businesses and leaves millions jobless people behind.
