State Bank of India (SBI) on Wednesday said its board has approved a proposal that would allow the bank to raise equity capital of up to Rs 15,000 crore in FY18. In January 2014, SBI had raised Rs 8,032 crore with Life Insurance Corporation of India picking up a big chunk of around 41 per cent of the total shares sold. The shares were priced at Rs 151.76 each and the bank had hoped to raise Rs 9,600 crore.
The SBI stock ended Wednesday at Rs 277.40, ahead of the late-evening announcement. At this price, the stock — including subsidiaries — trades at 1.2 times price to adjusted book for 2017-18. On a standalone basis, it trades at 1.3 times. Once the merger with associate banks is complete, SBI’s consolidated balance sheet would be approximately Rs 35 lakh crore, making it one of the top 50 banks in the world. At the end of December, SBI’s standalone balance sheet was Rs 25.8 lakh crore.
As of the December quarter of FY17, SBI’s total capital adequacy ratio stood at 13.73 per cent, of which tier I capital adequacy ratio was 9.97 per cent. “We advise that the central board of the bank at its meeting held on March 15 has accorded its approval for raising of equity capital up to Rs 15,000 crore during FY18 by way of FPO/rights issue/ESPS/ESOS/QIP/ADR/GDR and any other mode or a combination of these, as may be decided at the opportune time…,” the bank said.