The State Bank of India (SBI) is reportedly looking to mobilise a ¥30 billion ($197 million) debt facility.

The proceeds of the yen loan is likely to be used by the country’s largest lender for foreign currency lending.

A Bloomberg report on Thursday said that Mitsubishi UFJ Financial Group is the lead banker for the loan, which will be raised at the Gujarat International Finance Tec-City (GIFT City).

It added that the facility carries a five-year tenor. SBI thus joins others who have raised yen loans in Asia.

The state-owned lender could pay an interest margin of 60 basis points over the Tokyo overnight average rate (TONA), a global benchmark barometer for yen-denominated deals, the report said.

This rise in overseas entities (outside Japan) raising yen debt, called the Samurai loans, comes as they look at lower funding costs and also diversify from the expensive dollar space.

Borrowers from Asia excluding Japan have signed a record ¥1 trillion in such facilities year-to-date, according to a Bloomberg-compiled data.

SBI had also raised a loan in Japanese currency in September 2023, when it signed for a ¥40 billion five-year loan.

The SBI share on Thursday ended lower by 0.91 per cent at ₹853.75 on the BSE. In late November, SBI had raised ₹10,000 crore from infrastructure bonds. This took its total fundraise from such debt instruments to ₹50,000 crore in the current financial year.

Earlier last month, it had mobilised ₹10,000 crore through its seventh infrastructure bond issuance.

Similarly, the bank raised ₹5,000 crore AT1 bonds, ₹15,000 crore Tier 2 Bonds and ₹30,000 crore in long-term bonds during the fiscal. According to the bank, these came at very competitive rates.

SBI also said that these issues attracted overwhelming responses.

The private sector lender clocked a net profit of ₹16,820.97 against ₹15,976.11 crore in the corresponding period of the previous year.

During the quarter, its core net interest income (NII-interest earned minus interest expended) rose 10 per cent to ₹30,110 crore from ₹27,390 crore in the year ago period.

On the asset quality front, the percentage of gross non-performing assets (NPAs) to gross advances came in marginally higher at 1.36 per cent compared with 1.33 per cent in the first quarter.