State Bank of India chairman Dinesh Kumar Khara on Wednesday said the planned share sale of the bank's mutual fund subsidiary has been shelved for the time being.

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SBI Mutual Fund, the country's largest asset manager with around Rs 6.5 lakh crore in asset under management, had in February selected seven merchant bankers for a USD 1-billion IPO. But soon the markets turned volatile with the Russian invasion of Ukraine later in that month.

"There is no plan to list SBI Mutual Fund for now," Khara told reporters on the sidelines of the national banking summit here. Without citing any reason, he said the IPO plan stands shelved for now.

On December 15, 2021, SBI had announced its plan to offload a 6 per cent stake in SBI MF through an IPO and was planning to raise around USD 1 billion.

SBI holds a 62.6 per cent stake in SBI Mutual Fund, while the remaining 36.8 per cent is with the leading French insurer Amundi Asset Management which was planning to offload 4 per cent of its holding.

Initially Amundi's holding was held by Societe Generale Asset Management, a subsidiary of Societe Generale of France which was transferred to Amundi in June 2011.

SBI had reportedly selected seven i-bankers -- BofA Securities, Citi, HSBC Securities, Axis Capital, Kotak Capital, SBI Caps and BNP Paribas -- for the share sale.

SBI has two other publicly traded subsidiaries -- SBI Life and SBI Card -- and has three more which can be monetised -- the mutual fund arm, general insurance vertical and the investment banking arm, SBI Caps.

SBI Life was listed in 2017. In a Rs 8,400-crore share sale, the IPO was oversubscribed 3.58 times. SBI Card was listed in March 2020 just before the outbreak of the Covid pandemic in a Rs 10,354-crore public issue.

If listed, SBI MF or SBI Funds Management, would have been the fifth listed fund manager after HDFC AMC, UTI Asset Management Company, Nippon Life India AMC and Aditya Birla Sun Life AMC.

Meanwhile, the SBI chairman said credit demand, which has hit an eight-year high of 18 per cent last week, is coming in from across sectors, including SME corporates, retail and agriculture and that credit growth is a clear reflection that the economy is on a rebound.

"There is a healthy demand in the housing sector despite rising rates. Higher rates have not deterred demand," Khare said, adding, he expects credit growth to be moderate going forward but will remain healthy overall to about 15-16 per cent after festive pickup normalises.

On the digital rupee launch by the RBI on Tuesday, he said the CBDC pilot has gone well on the first day. He also said he doesn't think that bank deposits will be impacted with a full-scale launch of CBDC, which may happen over the next year.

He further said there is no concern on the restructured book as it is behaving better than expected. The NARCL or the national bad bank, is now quite active. "We will see good traction on that front going forward," he said,