Ganesh Benzoplast

EPW Research Foundation IN addition to being the largest commercial bank in India and having the largest branch network in the world, State Bank of India (SBI) is also the largest profit earner among banks in India. The bank acts as banker to the government, provides working capital and term finance to Indian industry, carries on international banking business in India and also extends technical and financial assistance for agriculture related activities. SBI has already fully computerised some of its branches and computerisation at other branches is under progress. SBI has several banking as well as non-banking subsidiaries. In response to the guidelines issued by the Reserve Bank of India to all scheduled commercial banks to imple- ment capital adequacy measures and strengthen their respective capita! bases in a phased manner, SBI will enter the capital market with a simultaneous issue of equity shares of Rs 10 each at a premium of Rs 90 aggregating Rs 1,240 crore and unsecured, redeemable, subordinated floating interest rate bonds in the nature of promissory notes of Rs 1,000 each aggregating Rs 500 crore The bonds, carrying a floating rate of interest payable halt-yearly at 3 per cent over the bank's maximum term deposit rate will have a minimum coupon rate of 12 per cent per annum and no maximum ceiling subject to reflxing at regular intervals of six months. SBI also has the right to retain a further Rs 500 crore over-subscription of the bond issue and also up to 15 per cent over-subscription of the equity issue. Out of the total issue of 12,40,00,000 equity shares,, 2,45,00,000 equity shares are reserved for allotment to Indian financial institutions, 2,45,00,000 equity shares are reserved for Indian mutual funds while the balance 7,50,00,000 equity shares are being offered to the public The issue, which will open for public subscription on December 15, and close on December 24, will be lead managed by IDBI and ICICI Securities and Finance Company.