SBI keen to take stake in a private equity fund

The State Bank of India (SBI) is on the lookout for a stake in a private equity fund.

"As of now there are no private equity funds in the country, but a couple of large business houses have shown interest in setting up such funds. We would be keen to take a stake in these entities," said C K Bhattacharya, managing director of SBI.

"We have tried our hands on equity funding through SBI Caps but have burnt our fingers because projects did not take off. SBI does not have the expertise to run a private equity fund; it is not our cup of tea. We would like to remain away from it. But given an opportunity we would take a stake in such funds if set up by other entities."

He was addressing a banking conclave in the city today organised by the Federation of Indian Chambers of Commerce & Industry and the Indian Chamber of Commerce.

Although Bhattacharya declined to name the business houses intending to set up equity funds, sources close to the development said SBI has already entered into talks on this score.

Meanwhile, SBI hopes to sanction Rs 8,000 crore for project financing and expects to disburse around Rs 4,000 crore this year in the category.

If achieved this would be a 25 per cent growth over the previous fiscal. The bank has also firmed up plans of making its presence in the international arena felt in a big way and has also decided to open offices in Muscat, a third office in Bangladesh, in the Middle East, and one more each in Thailand and Korea.

Bhattacharya also said that the bank has targeted a 18 per cent growth in deposits mobilisation and a 16 per cent growth in credit disbursal this year.

On the retail front, he said, SBI was expecting a 30 per cent growth.

Talking on project financing, he said that SBI has developed the segment as a separate strategic business unit.

"We see huge opportunities in the petrochem, iron & steel, engineering, oil and coal products, petro products, natural gas segment, paper and paper board, hospitality and the health care segments," explained Bhattacharya.