State Bank of India plans to raise around Rs4,500 crore through bonds from the overseas market in the next fiscal to fund growth plans. Besides, with credit offtake remaining slack in the first quarter, the bank does not see any reason to hike rates soon
New Delhi: The country's largest lender State Bank of India (SBI) today said it is planning to raise about Rs4,500 crore through bonds from overseas market in the next fiscal to fund growth plans, reports PTI.
"There will an issue overseas in the next financial year. It could be around $1 billion," SBI chairman OP Bhatt said on the sidelines of the Skoch event here.
It would be raised in one go, he said, adding that the exact quantum would be finalised at the appropriate time depending upon market condition and need.
Asked about interest rates, he said, they will remain stable during the next fiscal. Unless there is significant growth in credit demand, lending rate is unlikely to rise in the next few months, he said.
Credit offtake is relatively quite in the first quarter of a financial year, he added.
"There is a general upward bias in the interest rates in general. There has been more impact of it on deposit rates side because liquidity was tight and everybody was preparing for the quarter-end surge which takes place," he said.
"It has been less on the loan side so that bias continues but regardless of that my own sense is that in the next few months lending rate is not going to be increased," he added.
Pressure has been building up on banks to raise interest rates following a 25 basis points hike in short-term lending (repo) and borrowing (reverse repo) rates announced by the Reserve Bank of India (RBI) in its mid-quarterly review on 17th March.
Last month, SBI raised lending and deposit rates on select maturities by 25 basis points in response to a similar rate hike announced by the RBI in January.
SBI had revised the base rate or the minimum lending rate by 25 basis points to 8.25%. At the same time, SBI's Benchmark Prime Lending Rate (BPLR) for existing customers was also increased by 25 basis points to 13%.
Besides, the bank also increased fixed deposit rates on two select maturities by 25 basis points. Both 555 days' and 1,000 days' fixed deposits were increased to 9.25% from existing 9%.
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