It is reported that the State Bank of India (SBI) on October 26 stated that the Bank has raised Rs 5,000 crore by issuing Basel-III compliant bonds. The director’s committee of capital raising had a meeting on Monday and settled its approval to allocate 50,000 Basel-III compliant non-convertible, taxable debt instruments, State Bank of India  said in a regulatory filing. The debentures qualifying as tier II capital of the bank of face value of Rs 10 lakh each, at par, bearing a coupon of 5.83 per cent aggregating to Rs 5,000 crore were allocated to bond subscribers on October 26, 2020,  the bank said

The interest on the bonds will be paid annually for a tenor of ten years and call option after five years and on anniversary date thereafter, State Bank of India said. Under call option, the bond issuer can call back the bonds before the maturity date by paying back the principal amount to investors.

The Basel-III capital regulations are internationally accepted banking regulations under which banks need to improve and strengthen their capital planning processes. Basel-III norms are being implemented in phases since 2013 by Indian banks to mitigate concerns on potential stress on asset quality and consequential impact on performance and profitability of banks.

In the Bombay Stock Exchange, shares of SBI on Monday last closed 2.96 percent lower at Rs 196.75 per share on the BSE.

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