“It would most probably be the rights issue,” a key official source told PTI. However, the quantum and timing of the issue is yet to be finalised, the source said.
The rights issue would allow the bank to raise Tier-I capital without diluting the government’s  59.73 per cent stake. The government had recently bought RBI’s entire holding of 59.73 per cent in SBI. Under the current provision, the government may dilute its stake up to 55 per cent. A bill to further dilute government’s stake in SBI up to 51 per cent is pending in Parliament. Last month, SBI Chairman O P Bhatt said the bank will decide in two months whether to go for a rights issue or follow on public offer for rising funds. “It is still taking shape. The decision would be taken in a month or two,” he had said. Besides, the bank plans to raise about Rs 15,000 cr during this fiscal hrough a mix of Tier I and Tier II bonds. 
Capital position
The bank has set up a target to raise over Rs 89,00 crore in the next five years. “Based on the sensitivity analysis of its capital position, capital augmentation programme of SBI envisages raising about Rs 89,600 crore as capital funds during the next five years,” Minister of State for Finance Pawan Kumar Bansal had informed the members of Lok Sabha in a written reply.