State Bank of India plans to raise Rs10,000 crore by December

12 September 2007

Mumbai: State Bank of India, the country''s largest lender, plans to raise Rs10,000 crore ($2.5 billion) by December to consolidate its operations.

"We plan to raise Rs10,000 crore by December and we are evaluating various options of fund-raising," SBI chairman O P Bhatt said on the sidelines of a banking conference.
Bhatt said the bank has not decided the exact size or the timing of the issue, or whether shares would be offered in the domestic or foreign markets.

Bhatt had earlier said SBI might need up to Rs50,000 crore in the next few years to expand and invest in ventures including insurance, private equity and wealth management.

SBI will kick off the process of consolidation with the merger of State Bank of Saurashtra. "We will see how this goes before embarking upon further consolidation (with its other associate banks)," Bhatt said, adding, "We want to learn from this process and then go in for further consolidation."

However, no timeframe has been set for consolidation with the other associate banks of SBI, he said.

Bhatt said there had been a fall in credit demand but this month has seen a pick-up. "We are aiming for a 25 per cent growth in credit," he said.