NEW DELHI: State Bank of India (SBI) has raised Rs 4,000 crore via Basel- compliant Additional Tier 1 (AT1) bonds. The country’s largest lender announced on Wednesday that it raised the amount at a coupon rate of 7.72%.
Following the new Sebi regulations, this is the first AT1 Bond issuance in the domestic market. The circular issued by the market regulator said that the deemed residual maturity of Basel III additional tier-1 (AT-1) bonds will be 10 years until 31 March, 2022. The period will be increased to 20 and 30 years over the subsequent six-months.
From April 2023 onwards, the residual maturity of AT-1 bonds will become 100 years from the date of issuance. This is also the lowest pricing ever offered on such debt issued by any Indian bank since the implementation of Basel III capital rules in 2013, it added. The issue garnered overwhelming response from investors with bids in excess of Rs 10,000 crore received against a base issue size of Rs 1,000 cr.