State Bank of India seen to raise $5.09bn via rights issue

The lender targets $3.1bn if the government retains its 59% stake, $2bn for 51% and $2.43bn for 55%.

India's largest bank, State Bank of India has said that it expects to raise funds up to Rs 23,000 crore ($5.09 billion) through rights issue by March 2012 to fund its business growth.

"We are expecting it this fiscal. This fiscal most certainly around third or fourth quarter," SBI Chairman Pratip Chaudhuri said on the sidelines of board meeting held on Saturday.

Chaudhuri said that bank is in dialogue with the government and has presented various scenarios. "Rs 14,000 crore ($3.1 billion) if the government retains its 59% stake, Rs 9,000 crore ($2 billion) for 51% and Rs 11,000 crore ($2.43 billion) for 55%," he said. At present, government owns 59.4% in the bank. Chaudhuri also said that bank is not looking to go ahead with the merger of any its subsidiaries and will consider it in mid 2012, according to a report in Economic Times.