The State Bank of India (SBI), the nation’s biggest lender, announced on Tuesday that its board has given the green light to raise up to $3 billion through debt instruments in the present fiscal year.
The government-run bank will secure the funds in one or more installments via a public offering or a private placement of senior unsecured notes, which will be denominated in “U.S.dollars or another major foreign currency,” according to the bank’s statement.
SBI did not disclose the intended use of the proceeds from the fundraising, a Reuters report said.
Indian banks are strengthening their capital base to cater to the increasing demand for credit in the country.
Multiple government-owned banks, such as Canara Bank, Punjab and Sind Bank, and Punjab National Bank, have plans to raise capital through debt instruments in the current financial year.
Earlier this year, in January, SBI successfully raised 50 billion rupees (approximately $600 million) by issuing Basel III-compliant additional tier-I perpetual bonds.
Furthermore, SBI’s Chairman, Dinesh Kumar Khara, stated last month that the bank is also willing to raise equity capital to support its growth plans.
On Tuesday, SBI’s shares experienced a 0.8% increase, contributing to a total gain of 30.5% since the beginning of the year.