- Funding Goals: SBI to deploy $1.5 billion for international operations in FY 2024-25.
- Growth in Credit: Customer credit rose from $66 billion in June to $70 billion by September.
- Robust Pipeline: $3–4 billion worth of proposals in international business under review.
- Competitive Pricing: Raised $500 million through bonds at a 5.12% coupon rate, one of the best for Indian banks.
- Future Outlook: Softening interest rates expected to benefit Indian issuers with competitive pricing.
State Bank of India (SBI), the country’s largest lender, plans to use $1.5 billion in funding for its international operations over the next four months of FY 2024-25. This includes $500 million raised through bonds and $1 billion from syndicated loans.
SBI’s global operations are growing rapidly, with customer credit increasing from $66 billion in June 2024 to $70 billion in September, a $4 billion rise in just one quarter. “We see a healthy pipeline for the remainder of the year,” stated Jayati Bansal, Deputy Managing Director of SBI’s International Banking Group.
In rupee terms, SBI’s international book grew 11.56% year-on-year, reaching ₹5.88 trillion. This growth was led by external commercial borrowings (ECBs), local credit, and trade finance, with major contributions from branches in New York, GIFT City, Hong Kong, Dubai, and London. The bank also has $3–4 billion worth of proposals in the pipeline for its international business.
Indian corporates, including non-banking financial companies (NBFCs), submitted ECB proposals totalling $4.84 billion in September 2024. Of this, $3.77 billion was through the automatic route, while $1.06 billion required RBI approval.
Highlights of SBI’s International Operations
| Aspect | Details |
|---|---|
| Funding Raised | $500 million via bonds, $1 billion in loans |
| Growth in Customer Credit | $66 billion in June → $70 billion in September |
| Y-o-Y Growth (₹) | ₹5.88 trillion gross advances (11.56% increase) |
| Key Growth Drivers | ECBs, local credit, trade finance |
| Major Branches | New York, GIFT City, Hong Kong, Dubai, London |
| Future Proposals | $3–4 billion under review |
Competitive Fundraising
State Bank of India (SBI) recently raised $500 million through its medium-term note (MTN) program at a 5.12% interest rate, one of the lowest for an Indian bank in a five-year term. The rate improved by 33 basis points due to SBI’s strong credit reputation.
The bank also secured a $1 billion loan arranged by HSBC. Both fundraisers took advantage of falling global interest rates and recent rate cuts by the US Federal Reserve.
Bansal noted, “Indian issuers should be able to secure more competitive rates as the market adjusts to the current interest rate trends.“
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