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SBI will raise up to Rs 3 Bn via long-term bonds
ECONOMY & POLICY

SBI will raise up to Rs 3 Bn via long-term bonds

21 Jun 2024 2 Min Read CW Team
In the current fiscal year, the bank has already declared its intention to raise up to $3 billion in long-term financing from the global market through the private placement and public offering of senior unsecured notes denominated in US dollars or any other significant foreign currency. AAA credit rating with a stable outlook is attributed to the infrastructure bonds that SBI previously issued by domestic credit rating agencies. The regulatory reserve requirements, such as the cash reserve ratio (CRR) and the statutory liquidity ratio (SLR), do not apply to the proceeds from infrastructure bonds. You can use the whole amount for lending activities. Banks would be required to retain 4.5% of the total sum as CRR with the Reserve Bank of India if they were to raise equivalent amounts through deposits. In order to maintain SLR, they must also invest around 18% of their income in securities. SBI stated in its FY24 annual report that the government increased the amount allotted to capital expenditures from Rs 10 trillion in FY24 to Rs 11.11 trillion in the current fiscal year. The National Monetization Pipeline (NMP), Performance-Linked Schemes (PLI), and the National Infrastructure Pipeline (NIP), which has targeted investments of $1.4 trillion, are just a few of the measures the Indian government has launched to boost the economy. New initiatives are driven by the need to build up infrastructure on a large and sustainable scale, particularly in sectors such as renewable energy, roads, and city gas distribution. Investments in India?s key infrastructure sectors?rrenewable energy and roads?and real estate in FY25 and FY26 are pegged to grow about 38% over the previous two financial years to Rs 15 trillion, according to CRISIL Ratings.
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In the current fiscal year, the bank has already declared its intention to raise up to $3 billion in long-term financing from the global market through the private placement and public offering of senior unsecured notes denominated in US dollars or any other significant foreign currency. AAA credit rating with a stable outlook is attributed to the infrastructure bonds that SBI previously issued by domestic credit rating agencies. The regulatory reserve requirements, such as the cash reserve ratio (CRR) and the statutory liquidity ratio (SLR), do not apply to the proceeds from infrastructure bonds. You can use the whole amount for lending activities. Banks would be required to retain 4.5% of the total sum as CRR with the Reserve Bank of India if they were to raise equivalent amounts through deposits. In order to maintain SLR, they must also invest around 18% of their income in securities. SBI stated in its FY24 annual report that the government increased the amount allotted to capital expenditures from Rs 10 trillion in FY24 to Rs 11.11 trillion in the current fiscal year. The National Monetization Pipeline (NMP), Performance-Linked Schemes (PLI), and the National Infrastructure Pipeline (NIP), which has targeted investments of $1.4 trillion, are just a few of the measures the Indian government has launched to boost the economy. New initiatives are driven by the need to build up infrastructure on a large and sustainable scale, particularly in sectors such as renewable energy, roads, and city gas distribution. Investments in India?s key infrastructure sectors?rrenewable energy and roads?and real estate in FY25 and FY26 are pegged to grow about 38% over the previous two financial years to Rs 15 trillion, according to CRISIL Ratings.

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