Financial Daily from THE HINDU group of publications
Sunday, May 14, 2006
Financial Daily from THE HINDU group of publications Sunday, May 14, 2006 |
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Corporate
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Overseas Borrowings Money & Banking - Financial Institutions SIDBI to raise Rs 3,000 cr from multilateral agencies Our Bureau
FUND RAISING: Mr N. Balasubramanian (right), Chairman, SIDBI, with Mr V. Chandrasekaran, Executive Director, at a press conference in Mumbai on Saturday. — Paul Noronha
Mumbai , May 13 Small Industries Development Bank of India (SIDBI) plans to borrow about Rs 3,000 crore from multilateral agencies such as the World Bank, the Asian Development Bank and KFW, the German Development Bank, in the current fiscal. This would be part of Rs 4,600 crore required by SIDBI, the apex lender to SME sector, to meet its fund requirement for a 26 per cent targeted credit growth in 2006-07. The bank would also raise rupee funds from the domestic market through issue of zero-coupon bonds, said Mr N. Balasubramanian, Chairman and Managing Director. Last fiscal, SIDBI's credit portfolio grew by 28 per cent and the bank raised Rs 3,498 crore.
Outstanding credit
Mr Balasubramanian told presspersons that the outstanding credit is expected to go up to Rs 17,560 crore this year from Rs 13,890 crore last year. The retail SME portfolio is expected to grow by 52 per cent and micro finance credit to Rs 750 crore from Rs 339 crore When asked about whether SIDBI would be going in for an IPO, Mr Balasubramanian said the bank has no plans at the moment. He said he is drawing up a plan for augmenting the bank's capital, the details of which would be announced after a month-and-a-half.
Net profit up
Announcing the financial results for 2005-06, he said there was a 20 per cent rise in net profit at Rs 270.19 crore against Rs 225.23 crore in the previous year. Loan approvals rose 31 per cent to Rs 11,869 crore and disbursals increased by 44 per cent to Rs 8,885 crore. Mr Balasubramanian said that last year SIDBI made recovery of Rs 280 crore, following which its net NPA came down to 1.97 per cent from 3.97 per cent. The institution, which was started as refinancing agency for small-scale industries, started offering direct credit a few years ago and now direct credits account for nearly 50 per cent of its total advances. Recently, SIDBI undertook an initiative to ensure SMEs get adequate working capital in time. To this end, it had tied up with IDBI and started providing working capital through the bank. Though the funds would be disbursed through IDBI, credit risk would be borne by SIDBI. Mr Balasubramanian said SIDBI has taken steps to revive the state finance corporations and 10 of them have been provided assistance. It has also introduced a direct micro credit scheme providing funds directly to the clients of micro finance institutions.
More Stories on : Overseas Borrowings | Financial Institutions | SSI
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