SBI raises Rs 10,000 cr via bond sales to fund infra projects
State Bank of India on Wednesday raised ₹10,000 crore through a sale of infrastructure bonds, with the lender's first debt issuance of the current financial year witnessing firm demand from the investors.
Separately, ICICI Bank is likely to carry out a sale of infrastructure bonds on June 28, with the private lender looking to raise up to ₹3,000 crore through 10-year securities, debt capital market sources said.
SBI's infrastructure bonds, which mature in 15 years, bear a coupon — or rate of interest to be paid to investors — of 7.36%.
The coupon rate represents a spread of 21 basis points over the corresponding government security yield published by the Financial Benchmarks India, the bank said on Wednesday.
Within the banking sector, State Bank Of India's bonds typically bear the lowest coupons as investors perceive its debt issuances as low risk, given the bank's government ownership and status as the country's largest mass lender.
State Bank of India received 143 bids in excess of ₹19,884 crore for the bond sale, which had a base size of ₹5,000 crore and a greenshoe option of ₹5,000 crore.
Investors were across provident funds, pension funds, insurance companies, mutual funds and corporates, the bank said, adding that the proceeds of the bond would be used to boost funding to infrastructure and the affordable housing segment.
Funds raised through infrastructure bonds, which have a minimum maturity of 7 years, are exempted from the maintenance of statutory liquidity ratio and cash reserve ratio, which are
