One can expect SBI’s pricing to be benchmarked against that of South Korea’s Kookmin Bank, as per the report
State Bank of India (SBI) is reportedly planning to raise close to $500 million through global bond issue. As per a report, the SBI may seek guidance of international banks for a potential $500 million fundraise, the timing of which has not been decided yet.
According to a report in the Economic Times, the SBI is expected to formally reach out and engage with investment banks next week for the proposed $500 million raise via global bond issue. This could also scale up in size depending on the kind of response it gets from investors. For this, European, Japanese and American – all important banks of these countries are expected to be reached out by SBI.
“SBI has made primary enquiries with foreign banks to raise around $500 million through the issuance of US dollar-denominated bonds under Reg S/144 A.....This move comes as the bank looks to raise funds and keep a close eye on the upcoming FOMC (Federal Open Market Committee) meeting scheduled for the first week of May,” the Economic Times quoted a source as saying.
The State Bank of India (SBI’s) borrowing rate is reportedly expected to be comparable to other banks in the field. The report adds that one can expect SBI’s pricing to be benchmarked against that of South Korea’s Kookmin Bank. The latter recently also reportedly raised a five-year bond at 95 basis points (bps) above the five-year US treasury rate.
So far, as per the report, SBI has bonds worth $600 million maturing in September 2023 and bonds worth $800 million maturing in early 2024.