State Bank of India (SBI) has successfully raised Rs 10,000 crores through its third infrastructure bond issuance, with a fixed interest rate of 7.54 percent. The bidding for these bonds took place on Monday, attracting an overwhelming response from investors.
SBI plans to utilize the proceeds from this bond issuance to enhance long-term resources for funding infrastructure projects and the affordable housing segment. The bonds have a tenor of 15 years, making it the first long-term bond issuance by any bank for this duration in the current financial year.
The response from investors was remarkable, with bids reaching Rs 21,698 crores, oversubscribing the base issue size by 4.34 times. A total of 115 bids were received from a diverse group of investors, including provident funds, pension funds, insurance companies, mutual funds, and corporates.
This success follows SBI’s previous infrastructure bond issuance of Rs. 9,718 crores on January 19, 2023. The Bank attributes its ability to raise these funds to its AAA credit rating, which comes with a stable outlook from domestic credit rating agencies for such instruments.
The issuance of these infrastructure bonds by SBI plays a crucial role in financing long-term projects and promoting affordable housing development in India. By attracting a wide range of investors, including key financial institutions, SBI underscores its strong position in the market. This successful bond issuance reflects investor confidence in SBI’s credibility and stability, further strengthening its reputation as a reliable financial institution.
SBI’s commitment to funding infrastructure and affordable housing aligns with the government’s emphasis on these sectors. Such initiatives contribute to the overall growth and development of the country, creating opportunities for economic progress and social welfare.
With its successful bond issuance, SBI sets a positive precedent for other banks and financial institutions to follow. This achievement not only enhances SBI’s standing but also strengthens the country’s financial landscape.
In conclusion, SBI’s recent infrastructure bond issuance demonstrates its ability to attract significant investor interest and secure long-term funding for crucial sectors like infrastructure and affordable housing. The overwhelming response from investors reflects their confidence in SBI’s credit rating and its commitment to the development of the country.
