State Bank of India successfully raised $600 million through the issuance of dollar bonds
On Wednesday, the State Bank of India (SBI), the largest lender in the country, secured $600 million through a five-year bond issuance, marking the inaugural dollar bond fundraising from India in 2024 under its $10 billion medium-term note program. The London branch of SBI, in this benchmark-sized offering, received a BBB long-term issue rating from S&P Global Ratings.
The deal witnessed strong demand, with the order book reaching $3.5 billion, attracting participation from large, high-quality, long-only asset managers across Asia, Europe, the Middle East, and Africa, according to sources familiar with the matter. The bond, priced at 117 basis points over comparable US treasury bonds, equating to a yield of 5.1 percent, garnered attention from investors worldwide.
Bank of America, Standard Chartered, HSBC, BNP Paribas, JP Morgan, and Mitsubishi UFJ Financial served as arrangers for the transaction, which saw investments from entities like T Rowe Price and Schroders.
S&P justified the BBB long-term issue rating by emphasizing SBI’s dominant market position and robust deposit franchise. The agency noted that SBI’s strong performance is underpinned by India’s robust economic growth, supporting the bank’s loan growth, asset quality, and profitability.
This fundraising initiative closely followed SBI’s recent issuance of $1 billion through offshore syndicated loans. In the July-September 2023 period, SBI’s global operations witnessed an 8.11 percent YoY growth in gross advances, reaching Rs 5.27 trillion. Additionally, the bank successfully placed $250 million in senior unsecured green floating rate notes, termed ‘green notes,’ maturing on December 29, 2028, as part of its ongoing financial activities.
