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State Bank of India (SBI) is likely raise close to $1 billion through medium-term notes (MTN) in the next financial year.
“There will be an issue in the overseas market in the next financial year. The money would be raised in one go,” said SBI Chairman, Mr O. P. Bhatt, on the sidelines of the Skoch summit here on Friday.
Mr Bhatt added that the quantum of overseas fund-raising plan would be finalised at an appropriate time depending on the market conditions and the need of the bank.
Commenting on interest rates, Mr Bhatt said that they are likely to remain stable during the current fiscal. “Unless there is significant growth in the credit demand, lending rate is unlikely to rise in the next few months,” he added. The SBI Chairman said that credit off-take is relatively quiet during the first quarter of a financial year.
There is a general upward bias in interest rates, but the impact has been more on the deposit rates side because liquidity was tight and everybody was preparing for the quarter-end surge, he added.
Pressure has been building up on banks to raise interest rates following a 25 basis points hike in short-term lending (repo) and borrowing (reverse repo) rates announced by the RBI at its mid-quarterly review on March 17.
Last month, SBI raised lending and deposit rates on select maturities by 25 basis points in response to a similar rate hike announced by the Reserve Bank in January.
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