The country’s largest bank, State Bank of India, has said that it is not looking at setting up a special purpose vehicle (SPV) for its real estates, an option being considered by the finance ministry as a means of raising capital from markets.
“We are not considering that option of SPV,” State Bank of India (SBI) Chairperson Arundhati Bhattacharya said.
The idea of setting up an SPV for raising capital from markets was floated at a meeting of Finance Minister P Chidambaram and heads of public sector banks last week.
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Based on this income stream, the SPV will raise money from markets.
SBI, however, plans to set up a holding company for the purpose of raising capital.
“It (setting up a holding company including all subsidiaries) is one of the possibilities (for raising capital)....Currently, there is no clear view on this,” she had said.
The proposal for setting up of a holding company with the government, she said, adding, it requires regulatory clearances.
Last week, Financial Services Secretary G S Sandhu had said various options like employees stock option, special purpose vehicle model and holding company model were discussed in the meeting of Finance Minister P Chidambaram with heads of PSU banks by which banks could raise funds.
He had said the government could provide capital only up to a limited extent and the remaining funds had to be raised from markets.