State Bank of India to raise $1.63bn

The fundraising activity before March aims to augment thin capital and weakening asset quality.

State Bank of India, India's largest lender, needs to raise 80 billion rupees ($1.63 billion) before March to maintain an 8 percent tier-I capital adequacy ratio, a top official at the bank said on Sunday.

Rating agency Moody's last month downgraded the standalone rating of SBI citing thin capital and weakening asset quality.

The rating agency said the lender's reported Tier 1 capital ratio of 7.6 percent at the end of June, which was below the 8 percent level the government had pledged to maintain in state banks, pushed its rating into the lower band, according to a report in Economic Times.

"We need to raise 80 billion rupees before March to maintain 8 percent Tier-I," said Diwakar Gupta, chief financial officer at the state-run lender, without providing details of the fund-raising plan.