SBI Chairman C S Setty has said that ₹25,000 crore equity capital raised through the qualified institutional placement route earlier this year would support ₹12 lakh crore credit growth and maintain a capital adequacy ratio of 15% over 5-6 years.
On the debt capital side, he said, the bank would mobilise ₹12,500 crore through bonds as part of a periodic exercise.
"Even before this QIP was raised, our ability to fund credit growth has never been a problem. We wanted to strengthen the capital ratios, so we have done that. Our long-term strategy is to maintain CRAR at 15% and Common Equity Tier 1 at 12%," he told PTI in an interview.
31 October 2025
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This kind of Capital to Risk Asset Ratio (CRAR) gives the bank the ability to fund advances over ₹12 trillion, he said.
"With a profit rate what we have today, if the same profitability is maintained for another 5-6 years, we may not require any capital raising, at least on the CET 1 part," he said.
SBI in July this year raised ₹25,000 crore through a qualified institutional placement (QIP) of its equity shares, making it the largest QIP executed in Indian capital markets. Before this, the bank had raised ₹15,000 crore equity capital again through QIP in June 2017.
As far as fund raising from Tier II bonds is concerned, Setty said, the bank do it periodically to replace maturing papers and this year the bank would be raising another ₹12,500 crore through such bonds.
The SBI chairman also expressed confidence in achieving its 3% net interest margin guidance even if the Reserve Bank decides to cut the repo rate by 0.25% in next week's monetary policy review.
Highlighting that the RBI decision next Friday will be a "close call", he said, the house view at SBI is pointing towards a shallow cut of 0.25%.
"...if a December rate cut is there, but our house view again is that it would be a shallow rate cut of 0.25%, so it may not have any significant impact on the margins," he said.
Earlier this week, RBI Governor Sanjay Malhotra said that there is a space for a rate cut, and it was mentioned in the last bimonthly policy in October.
The recent statement and macroeconomic indicators have triggered widespread expectations of a rate cut in the upcoming Monetary Policy Committee decision on December 5.
Setty, the chairman of the country's largest lender, said that with growth keeping up at high levels - the bank expects Q2 real GDP expansion at 7.5% and 7% for FY26 - RBI will have to take a close call.
"...the higher growth rate also poses some sort of communication challenge for the RBI. So when the higher growth rate is there, how is that rate cut is undertaken, but the softer inflation indicates that there is room for a rate cut," the SBI chairman said.
On the margins front - where all the lenders have had a difficult time due to RBI's 1% point cut this year - Setty affirmed that there exists multiple levers for SBI to protect the crucial number influencing profitability.
Aspects which will help the NIMs include the complete benefit of the 1% point cut in cash reserve ratio, which has the potential to increase interest income as more resources get available for lending, repricing of the fixed deposits booked earlier at elevated rates and also the benefits of the 0.2% cut in savings bank account rates announced earlier, he said.
