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SBI To Tap Overseas Bond Market Again; Eyes $1.5-Billion Dollar Debt

State Bank of India (SBI) will hit the overseas debt market with a $1.5-billion dollar bond sale in the next financial year. The public sector lender recently received board approval to raise Rs 15,000 crore through multiple routes.

The bank did not specify when it will tap the dollar bond market. It had announced its intention to raise a similar amount in dollar debt in June last year but did not proceed with the plan.

In a BSE filing on Monday, SBI said its "executive committee of the central board will meet on March 24 to examine the issuance of RegS bonds worth $1.5 billion for a tenor not exceeding 5.5 years in financial year 2017-18." The board meeting will also finalise issuance of equity shares to the shareholders of three of its listed subsidiaries, which will be merged with it along with two other unlisted associates, from April 1, the filing added.

The three listed associate banks are State Bank of Travancore, State Bank of Mysore and State Bank of Jaipur and Bikaner, while the two unlisted ones are State Bank of Hyderabad and State Bank of Patila.

The government on Monday said the Bharatiya Mahila Bank will also be merged with SBI over the next three months.

After a long gap, SBI had tapped the overseas debt market in late January and had raised $500 million in a five- year dollar bond sale. The drawdown was carried out through its London branch, and are now traded on Singapore Exchange.

This bond sale was part of the nation's largest lender's $10-billion medium-term notes programme.

Before this, SBI had raised $300 million last September and prior to that in February 2014, it had raised $1.25 billion in dollar debt.

The bank has so far raised $3.5 billion out of its $10 billion medium term note (MTN) programme, including $400 million in perpetual bonds.

The bank had also concluded AT1 Basel III-compliant non-convertible, perpetual non-call five-year subordinated, unsecured notes at a coupon 5.5 percent payable semi-annually under $10 billion RegS bond programme.