SBI prices preferential shares at Rs2,312; to raise Rs3,004 crore from government

State Bank of India (SBI) will issue preference shares at Rs2,312.78 each to the government to raise a total of Rs3,004 crore, as part of a capital infusion plan, the bank said in a filing with the Bombay Stock Exchange (BSE).

The issue is at a premium of around Rs116 to SBI's Friday's closing price and a Rs89.78 premium to its current trading price of around Rs2,223 on the BSE.

"The executive committee of central board of the bank has fixed issue price at Rs2,312.78 per share of face value of Rs10, including a premium of Rs2,302.78 per share, for the preferential allotment of equity shares to the government of India," it said.

The board approved the capital infusion of Rs3,004 crore for 2012-13 on 23 February, the filing said.

The funds will be used to support the bank's national and international operations, including through its subsidiaries and associates, SBI said in the filing.

Last fiscal, the government had infused Rs7,900 crore in SBI to increase its Tier-I capital, raising its holding in the country's largest lender to 61.58 per cent from 59.4 per cent earlier.

The government had approved capital infusion of Rs12,517 crore in around 10 state-owned banks by March, against the Rs12,000 invested in the previous year (2011-12).

The government had pumped in about Rs20,117 crore in public sector banks in 2010-11.