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SBI Plans First Indian AT‑1 Perpetual Bond Issuance in 2026 to Raise ₹5,000 Crore
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Key Highlights
* SBI will pioneer the issuance of Basel III‑compliant AT‑1 Perpetual Bonds in India.
* The bank targets ₹5,000 crore through the new bond issue.
* A five‑year call option is embedded, contingent on RBI and regulatory approval.
* The launch aligns with SBI’s FY 2026‑27 capital‑raising plan of up to ₹60,000 crore.
* AT‑1 Perpetual Bonds strengthen Basel III capital, elevate the Capital Adequacy Ratio, and diversify long‑term funding.
Detailed Insights
State Bank of India, after receiving board endorsement in June 2026, is set to issue Basel III‑compliant Additional Tier‑I (AT‑1) Perpetual Bonds worth ₹5,000 crore within the next fortnight. These instruments differ from conventional bonds by lacking a fixed maturity date中色 risico but feature a call option exercisable after five years, subject to Central Reserve Bank of India (RBI) sanction and other regulatory bodies’ approval.
Strategically, the issuance feeds into a broader ₹60,000 crore capital‑raising initiative comprising Infrastructure Bonds, AT‑1 Bonds, and Tier‑II Bonds. The primary objectives are to reinforce the bank’s capital base, support credit expansion, and meet evolving regulatory capital norms mandated by Basel III.
Comparatively, the last AT‑1 issuance by an Indian lender—Canara Bank in November 2025—saw a ₹3,500 crore raise at a 7.55% coupon. SBI’s former AT‑1 release in October 2024 netted ₹5,000 crore at a 7.98% rate with a ten‑year call provision. The upcoming issue will make SBI the first Indian bank to launch such bonds in 2026.
