State Bank of India (SBI), the nation’s leading lender, recently informed exchanges that the company has raised Rs. 7,500 crores today at a coupon rate of 7.33% in its second Basel III compliant Tier 2 bond for the current financial year. The bonds have a tenor of 15 years, with a call option after 10 years and following anniversary dates and are rated AAA with a stable outlook by CRISIL Ratings Limited and CARE Ratings Limited.
The issue received an enormous response from investors, with bids exceeding three times the base issue amount of Rs. 4,000 crore. The overall number of bids received was 77, suggesting participation by a varied set of qualified institutional bidders.
As per the exchange filing, “The investors were across provident funds, pension funds, mutual funds, banks etc. Shri C S Setty, Chairman said that wider participation and heterogeneity of bids demonstrated the trust investors place in the country’s largest Bank.”
The Bank decided to accept Rs. 7,500 crores at a coupon rate of 7.33%, payable yearly for a 15-year period, with a call option after 10 years and on each anniversary date thereafter, based on the response.
