SBI's Strategic Financial Maneuvers: Navigating Growth Amidst Rate Cut Speculations

SBI Chairman C S Setty discusses the bank's financial strategies, including a significant Rs 25,000 crore equity raise to bolster credit growth and maintain strong capital ratios. Expectations of a repo rate cut by the RBI and its implications on net interest margins are also addressed as the bank navigates economic forecasts.

The State Bank of India's Chairman, C S Setty, articulated the lender's strategic financial plans in an interview, highlighting a substantial Rs 25,000 crore equity raise via qualified institutional placement this year. This initiative is expected to support Rs 12 lakh crore in credit growth while maintaining a robust capital adequacy ratio of 15% over the next five to six years.

Setty further explained that the bank intends to mobilize another Rs 12,500 crore through bonds as part of a periodic refinancing effort. This strategy is part of the bank's long-term vision to sustain strong capital ratios and meet lending demands that could exceed Rs 12 trillion.

As the Reserve Bank of India ponders a potential 0.25% rate cut in its upcoming monetary policy review, Setty expressed confidence that the bank would achieve its net interest margin guidance, despite any regulatory changes. He highlighted multiple strategies at play for preserving profitability, even amidst fluctuating macroeconomic conditions.

(With inputs from agencies.)