InvestorQ : What is the purpose of SBI raising another Rs.5000 crore via bonds?
Angel dcosta made post

What is the purpose of SBI raising another Rs.5000 crore via bonds?

Answer
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Juvina Maggie answered.
4 weeks ago


SBI will raise up to Rs.5000 crore through the debt instruments in the current fiscal. These funds will be raised through the issue of Basel-III compliant debt instruments. This debt paper will be denominated in Indian rupees and would be most likely privately placed.

The Rs.5000 crore will be raised by way of additional tier-I or AT1 bonds. It may be recollected that AT1 bonds are quasi equity and are part of Tier-1 capital. However, as we saw in the case of Yes Bank, they are prone to default risk.