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Bank of Maharashtra is planning to float infrastructure bonds within the next six months.
The move comes after the Finance Minister mentioned in the Budget that bank funds collected to lend to the infrastructure sector will have a relaxation on SLR (Statutory Liquidity Ratio) or CRR (Cash Reserve Ratio).
According to Sushil Muhnot, Chairman and Managing Director, Bank of Maharashtra, the bonds will help the bank raise its exposure to the sector to approximately 17 per cent by the end of this fiscal.
At present the bank’s exposure stands at 14 per cent (or Rs 1,260 crore) of its total asset base of Rs 9,000 crore.
“We hope to build the infrastructure portfolio and go for infra bonds soon…. Maybe earlier than six months,” he told presspersons of the sidelines of the FICCI Banking & Finance Conclave.
Full benefits of the bonds will be visible by FY-16, with lending to infrastructure expected to contribute approximately 20 per cent of its portfolio.
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