The country’s largest lender, State Bank of India, plans to raise long-term funds up to $1.5 billion through bonds from international markets in the current financial year (FY21).
The executive committee of the central board will meet on June 11 to examine the status and decide on long-term fundraising plans.
The lender may raise the money through a public offer and/or private placement of senior unsecured notes in the US dollar or any other convertible currency this financial year, it said.
Bankers associated with international fundraising said lenders such as SBI raise funds from global markets on a regular basis for lending operations and to repay financial instruments that mature during the course of the year. Apart from market borrowings, SBI also uses bilateral arrangements and taps multilateral agencies for raising funds.
This March, SBI had raised $100 million through Floating Rate Notes (green bonds) at a coupon rate of the three-month London Inter-bank offered rate (Libor) plus 80 Basis points. The bonds were issued through SBI’s London Branch to be listed on Singapore SGX. SBI has already two climate initiative certified green bond issuances aggregating $700 Million.
Its foreign office loan book stood at $40 billion at end of December 2019, while deposits exceeded $15 billion, according to the presentation on the Q3FY20 results.
According to SBI’s annual report for FY19, it sanctioned foreign currency loans worth $12.91 billion to Indian companies and $10.36 billion to overseas entities.