Business News | SBI Raises Rs 97 Billion Through Infrastructure Bond
Get latest articles and stories on Business at LatestLY. According to SBI, the fund proceeds will be utilized to enhance long-term resources for funding infrastructure and the affordable housing segment. The tenor of these bonds is 15 years.
Mumbai (Maharashtra) [India], January 18 (ANI): State Bank of India (SBI), the country's largest lender, has raised Rs 9,718 crores (Rs 97 billion) through its second infrastructure bond issuance on Wednesday at a coupon rate of 7.70 per cent.
According to SBI, the fund proceeds will be utilised to enhance long-term resources for funding infrastructure and the affordable housing segment. The tenor of these bonds is 15 years. The issue attracted an overwhelming response from investors with bids of Rs 14,805 crore and was oversubscribed by 2.96 times against the base issue.
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The total number of bids received was 118, indicating wider participation. The investors were across mutual funds, provident and pension funds, and insurance companies, the SBI statement said.
Based on the response, the Bank has decided to accept Rs 9,718 crore at a coupon rate of 7.70 per cent payable annually for a tenor of 15 years. This represents a spread of 17bps over the corresponding FBIL G-Sec par curve. Before this, the bank had raised infrastructure bonds of Rs 10,000 crore on December 6, 2022, at a spread of 17bps over the corresponding FBIL G-Sec par curve. The bank has these instruments' AAA credit rating from domestic credit rating agencies. SBI said the issuance is significant considering this is the first time an Indian bank is issuing a 15 years long-term infrastructure bond helping the bank in long-term lending to the infrastructure segment.
SBI believes this issue will help develop a long-term infra-bond curve and encourage banks to issue for longer tenors. (ANI)
(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)