The Government is likely to take a decision within 15 days on giving the go-ahead for State Bank of India's rights issue and on its size. According to the SBI Chairman, Mr O.P. Bhatt, the bank hopes to launch the issue - expected to be around Rs 18,000-21,000 crore - before this fiscal-end.
The Government's stake in SBI is 59.4 per cent. Once the Government gives its approval for the issue, it will need to subscribe to the issue to the same proportion of its stake in SBI in order to ensure that its share in the bank remains at the present level. In case, the Government takes a decision to subscribe to the issue in cash, it will need to make room for additional expenditure. But if it goes for subscribing to the issue through the bond route, the impact might not be felt immediately.
