State Bank of India Announces September 5 Record Date to Exercise Call Option on Tier-II Bonds

The State Bank of India (SBI) has fixed 5 September 2025 as the record date to identify eligible bondholders for exercising the call option on its 6.24% Tier-II bonds. These bonds, issued in September 2020 for ₹7,000 crore with an original maturity of September 2030, will now be redeemed earlier on 20 September 2025.

Capital Raising Plans for FY26

As per news reports, SBI’s decision to redeem its bonds ahead of schedule demonstrates its proactive approach to managing its debt and equity structure. The bank has been witnessing a steady moderation in its Tier-II capital base over the past 3 years, with the ratio declining from 2.62% in March 2023 to 2.35% in March 2024, and further to 2.14% in March 2025.

To strengthen its capital position, the board has approved raising up to ₹20,000 crore through debt capital in FY26. Out of this, additional Tier-I (AT1) instruments are estimated at about ₹5,000 crore, while Tier-II instruments will account for roughly ₹15,000 crore. The timing of these issuances and the coupon rates will depend on prevailing market conditions, giving the bank flexibility to optimise costs and investor appetite.

At the end of June, SBI’s CAR stood at 14.63%, comprising common equity Tier-I of 11.1%, AT1 of 1.35%, and Tier-II at 2.18%. Following a ₹25,000 crore equity capital infusion from institutional investors, the bank expects its CAR to improve further to 15.33%, enhancing its resilience and growth capacity.

Read More: SBI Eyes Top 10 Global Bank Spot by Market Cap in 5 Years!

SBI Share Price Performance 

As of September 4, 2025, at 11:50 AM State Bank of India share price is trading at ₹810.15 per share, reflecting a decline of 0.25% from the previous day's closing price. Over the past month, the stock has surged by 1.82%. The stock's 52-week high stands at ₹875.45 per share, while its low is ₹680 per share.

Conclusion 

The State Bank of India’s decision to exercise the call option on its Tier-II bonds highlights proactive capital management. With approvals to raise ₹20,000 crore debt in FY26 and its CAR poised to rise post equity infusion, the bank is well-positioned to meet Basel-III requirements.

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