SBI plans to raise up to 20,000 crores of rupees to finance its growth

The SBI stock closed at 2.98% at BSE. Photo: Mint

New Delhi: On Tuesday, the country's largest lender, SBI, announced plans to raise up to 20,000 crores of rupees according to various modes, including an offer consecutive public sector (OPS), to finance its growth.

The bank's shareholders will meet on December 7 to consider the fundraising proposal, SBI

The bank has declared that the shareholders' consent would be solicited for the issue of shares in the amount of not exceeding 20,000 crores of rupees or an amount approved by the Government and the Reserve Bank by public issue (FPO) or a private placement, including qualified institutional investment (QIP) / GDR / ADR or any other method or a combination that may be decided by the board.

"It is proposed to use the proceeds of the issue to finance long-term financing. the capital growth needs of the bank, necessary to meet capital expenditures, making investments / loans and advances, enhances its long-term resources and thus strengthens the financial structure of the Bank and its subsidiaries and businesses as well as other general banking purposes authorized by the legislation in force ", indicates the document.

comply with Basel III capital requirements from 1 January 2019. However, domestic banks must comply with standards by March 31. It has been implemented in stages in India as of April 2013.

"The capital ratio of the bank (RCA) as of June 30, 2018 s & # 39, amounted to 12.83% and the capital of CET-I to 9.80% .The Central Board of the Bank decided that the Bank should maintain a minimum of RCA in accordance with the transitional provisions of the RBI according to Basel III ", did he declare.

SBI however indicated that it may be necessary to raise additional capital during the current tax period. [19659003] "As a result, given the growth of activity in the current year as well as in the coming years, it is necessary to have more capital, especially Category I … After badessing the various options available, taking into account the guidelines issued by the RBI, the bank planned to access the capital market to raise capital, "he added. [19659004] The SBI stock closed at 2.98% to Rs286.50 on the ESB.

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