State Bank of India raises $1 billion via syndicated social loan for further lending

MUMBAI (Reuters) - The State Bank of India, the country's top lender, on Tuesday said it raised $1 billion via a syndicated social loan from global banks for further lending to certain kinds of socially impactful businesses in India.

The funds will be used to further lend to microfinance institutions and self-help groups, a senior official at SBI, who declined to be named, told Reuters.

The loan facility was arranged through Japan-based MUFG Bank and Taiwan-based Taipei Fubon Commercial Bank Co. Ltd, SBI said in a release on Tuesday.

This is the largest overseas loan linked to environmental, social and governance (ESG) norms raised by a commercial bank in the Asia Pacific region and the second-largest social loan globally, SBI said.

The loan could rev up the bank's push towards adopting ESG practices, at a time when the federal government and the Reserve Bank of India are shaping up the country's green financing guidelines.

(Reporting by Siddhi Nayak; Editing by Sohini Goswami)