Millennium Post

SBI raises $1 bn through international bond sales

State Bank of India (SBI) has mopped up $1 billion in an international bond sale programme, according to one of the merchant bankers Citigroup.

'State Bank of India successfully sold its five-year senior unsecured bond (REG S)at 255 BPS over the US treasury yielding a coupon of 325 base per annum raising one billion dollars through its London branch. The issue was closed late last night,' Citigroup said on Friday.

However, SBI could not be contacted this morning for comments, though chairman Pratip Chaudhuri on Thursday had confirmed that the issue was to be closed on thursday night.

At 325 base, this could be the tightest money raised by a domestic corporate in a foreign market. The merchant banker also said the fixed bonds, which were sold to raise $1 billion, will be listed on the Singapore Stock Exchange and has a Baa2 rating from Moody's and BBB- by Standard & Poor's.

This is the third bond sale by State Bank of India in the past two years, with the latest being the $1.25 billion, it had raised in a 10-year issue last July. That issue was the largest-ever from a domestic bank and also the cheapest five year-issue by a domestic issuer.

At 3.75 per cent over the US treasury bills, the State Bank of India  issue was the cheapest-ever by a domestic company till date with the effective coupon rate, payable half-yearly, working out to be just 4.125 per cent.
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