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Primary dealer subsidiary opened to focus on core and non-core activities

NEW ARM: Mr V. P. Shetty (right), CMD, IDBI Ltd, and Mr O.V. Bundellu, Deputy MD, at a press conference in Mumbai on Thursday. — Shashi Ashiwal

Mumbai June 14 Industrial Development Bank of India Ltd plans to raise $1.5 billion through issue of medium term notes.

"We plan to raise the first of the total of four-to-five tranches of the issue in a period of three months," said the Chairman and Managing Director, Mr V.P. Shetty, while inaugurating the office of IDBI Gilts Ltd, the wholly owned primary dealer subsidiary of IDBI.

The lead arrangers to the issue are HSBC and Barclays, he said.

IDBI Gilts, with net-owned funds of Rs 100 crore, will focus on the core activities of dealing in government securities, bond market, underwriting and fixed income securities. It will also do `non-core activities' such as investment and trading in equity and in units of equity-oriented mutual funds, and advisory services.

IDBI is carrying out trading in government securities and debt through its capital market subsidiary, IDBI Capital Market Services Ltd.

Besides focusing on bond trading, and underwriting in auctions of primary issuance of government dated securities and treasury bills, IDBI Gilts plans to be a major player in interest rate swaps and credit derivatives market too, said Mr Shetty.

"We are looking at floating separate subsidiaries for private equity and for asset management. We are waiting for regulatory clearance for the same," he said.

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