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SBM Bank India raises Rs 125 cr through Basel III compliant Tier–II bonds
SBM Bank Tier II Bonds

SBM Bank India raises Rs 125 cr through Basel III compliant Tier–II bonds

| @indiablooms | 19 Apr 2022, 04:07 pm

Kolkata: SBM Bank India, a new universal bank under the Wholly Owned Subsidiary (WoS) mode, announced the successful completion of its fundraising initiatives, aiming to propel the expansion plans.

The bank raised Rs 125 crore through its maiden Tier-II capital Basel-III compliant bonds with a 10-year maturity. In addition, the Bank also raised Rs. 300 crore from NABARD under Automatic Refinance Facility.

The bonds issued with a call option at the end of the 5th year comes after SBM Bank completed its three full year of operations as a full-service Indian bank post commencement of business as a WoS of SBM Group Holdings.

SBM Bank India’s Tier-2 bonds have been rated as A+ (Stable) by ICRA.

Commenting on the Bond issuance, Mandar Pitale, Head – Treasury, SBM Bank India, said, “This achievement has put the Bank in an elite company of banks that have managed this distinction in the past.”

At the same time, the bank’s fundraising from NABARD signifies the first such deal made towards raising Long term Funds.

The Automatic Refinance Facility was provided considering the existing portfolio of indirect finance to microfinance borrowers in rural areas, which fulfill the objective of NABARD of sustained access to financial services for the unreached poor in rural areas through various microfinance innovations cost-effectively and sustainably.

Reacting to the development, Dipak Agarwal, Head – Corporate Banking, SBM Bank India, said, “This deal will encourage the Bank to lend more in rural areas for fulfilling its inclusive finance objective.”

Elaborating on the significance of the initiatives, Sidharth Rath, Managing Director & CEO, SBM Bank India, said, “The Bank has registered robust growth in the first three years of operations with highly efficient capital usage. We are now scaling up our vision and operations to transform the banking experience through technology, product proposition and talent. We would continue to utilise our resources judiciously, further improving our benchmarks.”

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