State Bank of India is in talks with Japanese lenders for a tie-up on the acquisition finance business, which the RBI recently opened for domestic lenders, a top official said on Friday.
The country's largest lender has the ability to fund up to Rs 94,000 crore to borrowers looking at acquisition finance, its chairman C S Setty told reporters on the sidelines of an IBA event here.
The Reserve Bank came out with the final guidelines on the acquisition finance front on February 13, allowing banks to lend up to 75 per cent of a deal and capping the overall exposure on that aspect at 20 per cent of its core capital.
3 February 2026
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Setty said SBI has been working with foreign lenders on the acquisition finance side, pointing out that it was open to do the business overseas and added that the opening up the possibilities domestically has led to conversations on similar tie-ups.
"We have been talking to Japanese banks mainly because they are active in that. But, there is no preference for anyone," Setty said.
To start with, SBI will prefer to avoid complex acquisition finance transactions involving lots of instruments like mezzanine debt etc and stick to simple equity and debt finance.
Given the sensitivities and confidentiality involved, usually one or two lenders perform underwrite a transaction and then rest of the lenders join it, Setty said.
SBI will now be formulating the standard operating procedures on how to go about the newly allowed business and get it ratified from the board before going ahead, he said.
Meanwhile, Setty said SBI Mutual Fund will be filing the draft red herring prospectus for the initial public offer by March and execute the listing of the asset management arm by September. PTI AA MR
