State Bank of India (SBI) is intending to raise about Rs 10,000-20,000 crore by the way of rights issue and is sure that a proposal along these lines might be announced in the budget. OP Bhatt, chairman of SBI told during the next 5 years, SBI will require Rs 40,000-50,000-crore capital, along with tier-II capital and saved profit. So the bank is looking to raise Rs 10,000-20,000 crore during 12-18 months via a rights issue.
Bhatt said that the bank is anticipating some announcement in the Union Budget. In 2008, SBI had raised Rs 16,736 crore by the way of rights issue, in which the government’s share was Rs. 10,000. Besides SBI, numerous other banks are anticipating that the finance minister will declare capital infusion in government-owned banks.
As per the SBI chief, the bank requires capital and will think about raising money at the appropriate opportunity. He elaborated that SBI would spend heavily in technology but declined to give any figures. He said SBI is looking to increase ATM network and raise expenditure on mobile banking and data warehousing. It also intends to introduce a payment gateway company to merge different kinds of payment as well as considering IT for risk management.