SBI Secures ₹6,051 Crore Via Tier 2 Bonds At Higher Yield

State Bank of India (SBI) has raised ₹6,051 crore through a Basel III-compliant Tier 2 bond issue, marking its second such borrowing this financial year.

This comes after an earlier round in October, when the bank had raised ₹7,500 crore at a slightly lower rate of 6.93%.

The higher rate this time reflects the change in market mood, where investors are now seeking better returns amid rising uncertainty.

These bonds have been given an AAA rating with a stable outlook by CRISIL Ratings and India Ratings and Research.

Overall, 47 bids were received, showing a very good response and participation of qualified institutional bidders.

The investors were not only provident funds but also pension funds, mutual funds, banks and were involved.

Why Did Investors Show Strong Interest?

Part of the demand comes from the bank’s position in the system. Being the largest lender, it generally enjoys strong investor confidence.

At the same time, the yield on offer was slightly higher than the previous issue. In a phase where markets have turned a bit cautious, investors tend to prefer instruments that offer stable returns without taking on too much risk.

The participation from different types of institutions also suggests that demand was not concentrated. That usually helps in building a more stable investor base.

Also, the bank posted decent Q3 results. The Q3FY26 net profit of the bank rose by 24.49% to ₹21,028 crore on a 9.69% increase in total income to ₹140,915 crore in Q3FY26 as against Q3FY25.

The closing price of State Bank of India (SBI) shares on 18 March 2026 was ₹1068.3 on the National Stock Exchange (NSE).

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What Can Investors Expect Next?

The successful issue indicates that the bank remains well-positioned to raise funding from the market with relative ease.

In case uncertainty in global markets persists, borrowing costs may well continue to get pushed up. There will also be attention on how the bank manages its capital mix between debt and equity going forward.

For now, the response to this issue suggests that appetite for high-rated bank bonds is still intact, even as overall market conditions remain slightly cautious.

Sources:

Business Standard

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