On Wednesday, an official statement was published by State Bank of India in which it announced that it would conduct an initial public offer (IPO) route which would then be leveraged to lessen the bank’s stake in its card business.
Currently, almost a 74 percent stake of SBI Cards & Payment Services Private Limited is owned by the bank known as India’s largest lender, as the rest 26 percent stake is owned by Carlyle.
A brief translation of the latest regulatory filing published by State Bank of India states that the proposal of exploring a possibility of reducing SBI’s stake in one of its subsidiary company (SBI Cards & Payments Services Private Limited) has received authorization by SBI’s Executive Committee of Central Board, however the proposal is subject to the approval of regulatory agencies such as RBI amongst others.
SBI’s regulatory filing also revealed that once the IPO which will be leveraged to dilute its stakes in SBI Cards & Payments Services Private Limited receives approval by the bank, Reserve Bank of India and other regulatory agencies, specific disclosures of the IPO will be published.
Notably in the first week of august reports emerged stating that the public offer would be unveiled in the fourth quarter of 2019, citing a statement given by the chairman of SBI Rajnish Kumar.
As per an official statement published by State Bank of India, its Card Services which was first launched back in October 1998 is now being used by nearly 6 million clients for various transactions.