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IDBI Bank plans to float a debt fund to enhance credit flow to the infrastructure sector in the country.
The bank was mulling the option of setting up an infrastructure finance company for floating the fund and was awaiting the Reserve Bank of India's guidelines for the same. “We have plans to float an infrastructure debt fund and are awaiting RBI's guidelines for the same,” Mr R. K. Bansal, Executive Director, IDBI Bank, said.
The Centre had come up with a framework for floating and regulating infrastructure debt funds in June this year. As per the framework, companies would have a choice to either use the asset management company (mutual fund) route or the non-banking finance company (NBFC) route to float the fund.
The bank's total exposure in the infrastructure sector is Rs 30,000 crore.
Mr R. M. Malla, Chairman and Managing Director, IDBI Bank, on Monday said that the bank might go for equity base expansion in the next financial year. “We are well capitalised at 13.6 per cent to achieve a targeted growth rate of 15-16 per cent during the current fiscal. We may, however, look to raise capital in the FY 2013,” he said.
‘Magic Card'
Mr Malla was speaking at a press meet to announce the launch of the bank's ‘Magic Card' which is a debit-cum-credit card here on Monday. The card would be offered to eligible salary accountholders of the bank and the credit limit would be a multiple of the monthly salary earned by the cardholder.
The bank would weigh options such as a follow-on public offer (FPO), rights issue or qualified institutional placement for its fund raising programme. “We will follow whichever route is cheaper and suitable,” he said, without divulging details on the amount likely to be raised.
At a time when commercial banks have been shying away from lending to the microfinance institutions, IDBI Bank plans to double its exposure to the sector to Rs 1,600 crore (Rs 800 crore) over the next one year.
IDBI Bank has trimmed down its exposure to film financing due to a significant rise in defaults, Mr Bansal said. The total outstanding under the bank's film loan portfolio stands at Rs 200 crore and it has non-performing assets to the tune of Rs 80 crore.
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