SBI to raise Rs 16,736 crore through rights issue

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Mumbai, Jan 14 (UNI) The country's largest lender, State Bank of India will raise Rs 16,736 crore (USD 4.3 billion) through a Rights issue to meet the demand for loans.

The central board of SBI, which met today, approved a proposal in this regard. The Rights issue would be in the ratio of 1:5 i.e one share for every five shares held by the eligible shareholders on the record date, the bank said in a communique to BSE today.

The price for the rights issue has been fixed at Rs 1,590 per share (a face value of Rs 10 each and a premium of Rs 1,580 per share) as against the current price of Rs 2,490 per share, it said in a statement.

SBI's shares, which rose more than 90 percent in 2007, ended 1.03 pc up at Rs 2462.25 today, after climbing to a record high of 2,540 before the announcement.

The board also approved a proposal to increase the issued capital of the bank from Rs 526.30 crore to Rs 650 crore.

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