State Bank of India raises Rs 15,000 crore via India’s largest QIP

MUMBAI: State Bank of India has raised Rs 15,000 crore from domestic and foreign institutional investors through qualified institutional placement (QIP) of shares, several sources familiar with the plans said on Monday.

The IPO closed on Tuesday morning and is believed to have received demand in excess of Rs 20,000 crore, ET Now reported. LIC bade for about 50 per cent of the offering, the report added.

The share sale by the country’s biggest lender -the largest QIP to hit Indian markets, surpassing SBI‘s Rs 8,000-crore issue in January 2014 -was fully committed prior to the launch, people cited above said.

The floor price of the share sale was fixed at Rs 287.58 apiece for a face value of . 1 each. The bank said in a statement ` that it may offer a discount of not more than 5% to the floor price.

The QIP will boost SBI’s capital adequacy to more than 14.50% from 13.11% now and ensure that it does not need capital for the next two years, according to the people cited above.

SBI had announced plans to raise funds through a follow-on public offer and institutional placement in the cur rent fiscal and sought applications from merchant bankers to manage the issue.The planned fund-raising follows the merger of five associate banks and Bharatiya Mahila Bank in April.

. 7,575 crore Last year, SBI had received ` from the government as part of the Centre’s capital infusion plan. As on March 31 this year, the government owned 62.22% of the bank.

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In January 2014, SBI had raised ` . 8,032 crore through a share sale that fell short of the . 9,600-crore target. Life ` Insurance Corporation had picked up nearly half the shares on sale. State-run lenders are keen to raise capital after a surge in stressed loans in the past few years eroded their capital. The government, which owns more than half of all these banks, has been reluctant to infuse more funds as banks failed to meet performance targets. The government plans to invest ` . 70,000 crore in public sector banks through fiscal 2019.