SBI raises Rs3,000 crore through 10-year bonds

State Bank of India today said it has raised Rs3,000 crore through issue of bonds on a private placement basis to boost its tier II capital, after the county's top lender reported a more than 50 per cent fall in its quarterly profit for the October-December 2015-16 period.

State Bank of India (SBI) has raised Rs3,000 crore through tier-II bonds, the bank said in an exchange filing today.

The Basel III compliant tier-II bonds are in the nature of debentures with an interest rate of 8.45 per cent per annum on February 18.

SBI's 10-year bond with face value of Rs10,00,000 each have a tenure of 10 years. These bonds, however, have a call option at the end of the fifth year under which the lender can redeem the bonds ahead of the tenure.

SBI chairman Arundhati Bhattacharya had, earlier this month, said the bank would raise tier-II capital during the fourth quarter of the fiscal.

SBI has plans to raise up to Rs15,000 crore in equity capital through various routes, including fresh public offer, rights issue, qualified institutional placement among others.

SBI declared a net profit of Rs1,115.34 crore for the quarter ended 31 December 2015 against Rs2,910.06 crore for the quarter ended 31 December 2014.

The bank had provided Rs8,483 crore (loan loss alone Rs7,645 crore) during the quarter as against Rs6,477 crore (loan loss Rs4,810 crore) provided during the corresponding quarter of previous year.

For the quarter ended 31 December 2015, the bank's total income has increased to Rs46,731.01 crore from Rs43,783.97 crore for the quarter ended 31 December 2014.

SBI's gross NPA stood at 5.10 per cent at the end of third quarter against 4.90 per cent for the period ended 31 December 2014.