In a regulatory filing, SBI said that its board accorded approval for raising funds in INR by issue of Basel III compliant Additional Tier 1 and Tier 2 Bonds.
The bank had reported Rs 70,901 crore in standalone net profit in FY25, growing by 16 per cent from Rs 61,077 crore in FY24. (Source: reuters)
State Bank of India (SBI) will raise up to ₹20,000 crore via issuance of bonds to domestic investors in the current fiscal year. In a regulatory filing, the country’s largest lender said its board has approved the fundraising plan through the issue of Basel III-compliant Additional Tier 1 (AT1) and Tier 2 bonds, subject to approval from the Government of India wherever applicable.
The fundraising is aimed at bolstering the bank’s capital adequacy and supporting its credit growth. AT1 and Tier 2 bonds form part of a bank’s regulatory capital under the Basel III framework, which was introduced to improve the banking sector’s ability to absorb shocks arising from financial and economic stress.
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This capital raise comes at a time when credit demand in the economy remains strong, particularly in the retail and services sectors. SBI, which holds the largest share in India’s banking system, is expected to continue playing a key role in financing infrastructure, MSMEs, and other priority sectors.
As of March 2025, SBI’s Common Equity Tier 1 (CET1) ratio stood at 10.81 per cent.
The bank is reportedly planning to raise up to Rs 25,000 crore through qualified institutional placement (QIP) route which would be the biggest share sale to institutional investors, if subscribed fully. QIP is a capital raising instruments for listed firms to raise capital via equity shares to qualified institutional buyers (QIBs), including VC funds, pension funds, and mutual funds.
SBI has been an active participant in the bond market, often setting pricing benchmarks for other public sector banks. The bank had raised Rs 10,000 crore via Tier 2 bonds in FY24, which saw strong demand from institutional investors.
The bank had reported Rs 70,901 crore in standalone net profit in FY25, growing by 16 per cent from Rs 61,077 crore in FY24. Its operating profit had crossed the Rs 1 lakh crore mark, up by 17.89 per cent year-on-year to Rs 1,10,579 crore. On a consolidated basis, the net profit stood at Rs 77,561 crore in FY25.
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