State Bank of India has successfully raised ₹6,051 crore through its second Basel III-compliant Tier 2 bond issuance for FY2025–26, reinforcing its capital position amid continued business growth.
Bond Issue Details and Investor Participation
The 10-year bonds carry an annual coupon of 7.05% and include a call option after five years, exercisable annually thereafter.
The issue witnessed strong investor appetite, attracting bids worth nearly twice the base size of ₹5,000 crore, with participation from 47 institutional investors, including provident funds, pension funds, mutual funds, and banks.
Key features of the bonds:
- Non-convertible, taxable, and redeemable
- Subordinated and unsecured in nature
- Face value of ₹1 crore per bond
The allotment date is scheduled for March 20, 2026, with maturity on March 20, 2036. The bonds have received AAA ratings with a stable outlook from CRISIL and India Ratings & Research, and are proposed to be listed on both BSE and NSE.
Strong Q3FY26 Financial Performance
SBI reported a robust performance for the December quarter (Q3FY26):
- Net profit: ₹21,028 crore (up 24.49% YoY)
- Operating profit: ₹32,862 crore (up 39.54%)
- Net interest income (NII): ₹45,190 crore (up 9.04%)
The bank’s domestic net interest margin (NIM) stood at 3.12%, while overall NIM was 2.99%.
Business Growth and Balance Sheet Strength
SBI’s total business crossed ₹103 lakh crore, reflecting strong expansion across segments:
- Total deposits: Over ₹57 lakh crore
- Advances: ₹46.83 lakh crore (up 15.14% YoY)
Domestic advances grew 15.44%, with retail loans increasing 16.51%. Within retail:
- Personal loans rose 14.95%
- Home loans grew 14.65%
Segment-Wise Lending Performance
Growth remained broad-based across lending categories:
- SME loans: Up 21.02%
- Agriculture loans: Up 16.56%
- Corporate loans: Up 13.37%
CASA deposits increased 8.88%, with the CASA ratio improving to 39.13%, indicating a stable and low-cost funding base.
Summary
State Bank of India has raised ₹6,051 crore through Tier 2 bonds to strengthen its capital base, supported by strong investor demand. The fundraise complements the bank’s solid financial performance and broad-based credit growth across retail, SME, agriculture, and corporate segments, reinforcing its balance sheet strength.
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