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SBI awaits Ministry nod

NEW DELHI: State Bank of India is awaiting the Finance Ministry’s clearance to raise capital to meet its additional capital needs for business growth and statutory requirement.

“We are under discussion with the Finance Ministry and awaiting clearance from them. Once we get the clearance, capital would be raised within 90 days,” SBI Chairman, O. P. Bhatt, told newspersons here on Friday.

While the bank is expected to mop up about Rs. 10,000 crore, it is yet not clear whether it will be through a public offer or a rights issue. A public offer would result in diluting the Government’s stake in the bank while a rights issue would keep it unchanged. Although the interest rates were likely to remain stable till October 30 when the Reserve Bank is to unveil its mid-term review of the monetary policy, Mr. Bhatt noted that the issue would be discussed after the Asset Liability Committee meeting. The banks would then take a call on interest rates for various sectors.

As for the prospects of lower rates of interest on auto finance, Mr. Bhatt said: “Every festival season, we come out with some scheme or the other not only for the auto sector but also for white goods and consumer products. This time around, it would not be any different.”

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