State Bank of India (SBI) will raise up to $2 billion in debt in the current financial year.

The company’s board has approved the fundraising proposal through long-term debt.

The executive committee of the bank’s central board in its meeting on 18 April 2023 has approved the fundraising in single/multiple tranches up to $2 billion through a public offer and/or private placement of senior unsecured notes in US dollar or any other convertible currency during FY 2023-24, SBI said in a regulatory filing to the stock exchanges.

SBI is expected to utilise the money for augmenting aditional Tier 1 capital and the overall capital base, and for strengthening capital adequacy in accordance with the Reserve Bank of India (RBI) guidelines.

Last month, SBI raised Rs 3,717 crore by issuing a Tier-1 bond at a coupon rate of 8.25%. It was SBI's third Tier-1 bond issuance in the previous financial year. The tenor of these bonds is perpetual, with a call option after 10 years and every anniversary thereafter.

Earlier in February, SBI raised $1 billion in syndicated social loans. This is the largest ESG loan raised by a commercial bank in the Asia-Pacific market.