The Hindu Business Line : IRFC raises mandated Rs 3,400 cr

Having raised equivalent of $125 million in Japanese yen recently, Indian Railway Finance Corporation has successfully raised Rs 3,400 crore that was was mandated in fiscal 2005-06.

The external commercial borrowing was raised on March 31, for a five-year tenure at competitive rates, said a senior IRFC official. He, however, declined to mention the exact cost at which the funds were raised. "There would a bullet repayment for the syndicated loan, in which 13 banks participated," said the official.

Meanwhile, bankers add that the prevailing costs are in the range of 60 basis points above Euro-Yen Libor. They also say that IRFC would have preferred a Yen loan because withholding taxes are lower (10 per cent) compared to dollar loans. This in effect would bring down the cost of borrowing.

In fiscal 2006-07, IRFC is budgeted to raise Rs 4,170 crore, which is an all-time high.

More Stories on : Financial Institutions | Overseas Borrowings | Railways

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