SBI Funds Management IPO: Citi and JPMorgan Pull Out Over Low Fees Citi-JPMorgan-Opt-Out-Of-SBI-Funds-IPO.jpg

As per Bloomberg, several large global banks have opted not to take up advisory roles on the planned $1.4 billion Initial Public Offering (IPO) of SBI Funds Management, citing the low fees on offer. 

Global Banks Decline Mandate 

Citigroup was part of the initial group of mandated advisers but later withdrew after fee-related discussions, the people said.  

Following its exit, SBI Funds Management appointed Jefferies Financial Group to replace Citi. JPMorgan Chase & Co. also chose not to proceed after pitching for the role, citing similar concerns around compensation. 

The IPO is expected to be a secondary share sale by existing shareholders, rather than a capital-raising exercise for the company. 

Fees Offered for the Transaction 

The selling shareholders, State Bank of India and France-based Amundi offered advisory fees of about 0.01% of the issue size, the reports suggest. Bankers described the fees as at the lower end for a transaction of this scale. 

By comparison, companies globally paid an average underwriting fee of 1.86% in 2025, up from 1.67% in 2024, according to data from LSEG. Some domestic advisers were also reported to have quoted only token fees for the mandate. 

Advisers Appointed 

Despite the withdrawals by some global banks, several firms have been selected to work on the IPO. These include Kotak Mahindra Capital, Axis Bank, SBI Capital Markets, Motilal Oswal Investment Advisors, ICICI Securities, and JM Financial. 

Local units of HSBC Holdings and Bank of America are also involved, as per the reports. 

Background  

Low advisory fees have been a feature of previous government-linked share sales in India. In July, when State Bank of India raised ₹250 billion ($2.8 billion) through a share sale, 6 bankers were reportedly paid one rupee each. 

Market Context 

SBI Funds Management is jointly owned by State Bank of India and Amundi. The partners plan to sell a combined 10% stake through the IPO, which could value the firm at about $14 billion. India was among the world’s most active IPO markets in 2025, with listings raising around $22 billion. 

Read More: Turtlemint Fintech Set to File UDRHP in Upcoming Two Weeks! 

Conclusion 

Adviser appointments for the IPO have largely been finalised, despite some global banks opting out. The offering structure and pricing are still being reviewed. 

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