India’s largest bank, State Bank of India on Wednesday said it has raised Rs 4,000 crore by issuing bonds at a coupon rate of 7.57 percent and the fund has been raised by issuing Basel III compliant tier II bonds.
The bank said the bond issue witnessed overwhelming response from investors, attracting bids worth Rs 9,647 crore, which was oversubscribed by about five times against the base issue size of Rs 2,000 crore.
“This is an indicator of the trust the investors place in the country’s largest bank. Based on the response, the bank has decided to accept Rs 4,000 crore at a coupon rate of 7.57 per cent,” SBI said in a release.
The coupon will be payable annually for a tenor of 15 years with a call option after 10 years and on anniversary dates, thereafter.
This represents a spread of 14 bps (basis points) — one basis points is 100th of a percentage point — over 10-year Government securities (G-sec), SBI said.
SBI said it has AAA (stable) credit rating from domestic credit rating agencies for these instruments.
