Tag: union cabinet

Centre to amend banking laws to facilitate privatisation of two PSU banks, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


To facilitate privatisation of two public sector banks (PSBs), the government is all set to introduce a banking laws amendment bill in the upcoming winter session starting Monday. Finance Minister Nirmala Sitharaman while presenting Budget 2021-22 earlier this year had announced the privatisation of PSBs as part of disinvestment drive to garner Rs 1.75 lakh crore.

The Banking Laws (Amendment) Bill, 2021, to be introduced during the session is expected to bring down the minimum government holding in the PSBs from 51 percent to 26 percent, sources said.

However, sources said a final call in this respect would be taken by the Union Cabinet when it would vet the proposed legislation.

“To effect amendments in Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980 and incidental amendments to Banking Regulation Act, 1949 in the context of Union Budget announcement 2021 regarding privatisation of two Public Sector Banks,” according to the list of legislative business for the Winter Session.

These Acts led to the nationalisation of banks in two phases and provisions of these laws have to be changed for the privatisation of banks, sources said.

In the last concluded session, Parliament passed a bill to allow privatisation of state-run general insurance companies.

The General Insurance Business (Nationalisation) Amendment Bill, 2021, removed the requirement of the central government to hold at least 51 per cent of the equity capital in a specified insurer.

The Act, which came into force in 1972, provided for the acquisition and transfer of shares of Indian insurance companies and undertakings of other existing insurers in order to better serve the needs of the economy by securing the development of general insurance business.

Government think-tank NITI Aayog has already suggested two banks and one insurance company to Core Group of Secretaries on Disinvestment for privatisation.

According to sources, Central Bank of India and Indian Overseas Bank are likely candidates for the privatisation.

As per the process, the Core Group of Secretaries, headed by the Cabinet Secretary, will send its recommendation to Alternative Mechanism (AM) for its approval and eventually to the Cabinet headed by the Prime Minister for the final nod.

The members of the Core Group of Secretaries include economic affairs secretary, revenue secretary, expenditure secretary, corporate affairs secretary, legal affairs secretary, Department of Public Enterprises secretary, Department of Investment and Public Asset Management (DIPAM) secretary and an administrative department secretary.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

RBI may screen bidders for bank privatisation at EoI stage, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The government is set to start consultations with the Reserve Bank of India (RBI) to devise a new security clearance framework for screening potential bidders of public sector banks (PSBs), according to a report.

As potential buyers of IDBI Bank and two other PSBs will need to meet the RBI’s fit and proper criteria, the government is planning to bring the central bank on board to vet candidates in the first step itself.

The RBI will screen bidders as early as when expression of interest is placed and only then the process will move forward.

The RBI considers several factors, including the applicant’s integrity, reputation and track record in financial matters and compliance with tax laws, ongoing proceedings of serious disciplinary or criminal nature, financial misconduct for its ‘fit and proper’ tag.

On the radar

The NITI Aayog, which has been entrusted with the job of identifyng suitable candidates for the privatisation, has recommended names to a high-level panel headed by Cabinet Secretary Rajiv Gauba.

Central Bank of India, Indian Overseas Bank, Bank of Maharashtra and Bank of India are some of the names that may be considered for privatisation by the Core Group of Secretaries on Disinvestment.

The other members of the high-level panel are Economic Affairs Secretary, Revenue Secretary, Expenditure Secretary, Corporate Affairs Secretary, Secretary Legal Affairs, Secretary Department of Public Enterprises, Secretary Department of Investment and Public Asset Management (DIPAM) and the Secretary of administrative department.

Following clearance from the Core Group of Secretaries, the finalised names will go to the Alternative Mechanism (AM) for its approval and eventually to the Cabinet headed by Prime Minister Narendra Modi for the final nod.

IDBI Bank

The government has invited bids from transaction advisors and legal firms for assisting in the strategic sale of IDBI Bank.

The Union Cabinet had in May given in-principle approval for IDBI Bank’s strategic disinvestment along with transfer of management control.

The central government and LIC together own more than 94 per cent equity of IDBI Bank. LIC, currently having management control, has 49.24 per cent stake, while the government holds 45.48 per cent. Non-promoter shareholding stands at 5.29 per cent.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , ,

Know how banks, financials performed this week, BFSI News, ET BFSI

Personal Finance

[ad_1]

Read More/Less


Domestic benchmark indices Sensex and the Nifty snapped their 3-day winning run yesterday, of which state-owned banks were among the major losers. The market has been showing signs of correction, with investors resorting to profit booking after a stellar record-setting spree.

Among sectors, public sector banks lost the most, while private banks gained the most today.

On Friday, banking and financial services stocks were in focus after Finance Minister Nirmala Sitharaman announced the much-awaited bad bank.The Nifty Bank scaled the crucial 38,000-level mark for the first time ever, and a fresh lifetime high of 38,112.75.

The BSE Sensex has gained around 9% over the last month. Stock-specific moves, weak cues from Asian markets, inflation data, revival of economic activity in Europe, improving economic data and healthy pick up in India’s daily inoculations were considered key driving factors this week.

Monday Closing bell: Indices end flat on negative bias, Nifty Bank falls

Domestic equity indices ended in the red on Monday, with BSE Sensex down 0.2% at 58,177 points and Nifty 50 down 0.08% at 17,355. However, mid and smallcap stocks outperformed other sectors, with BSE Midcap index closing 0.32% higher and the smallcap index ending with a gain of 0.80%.

Nifty Bank and Nifty Financial Services closed 0.58% and 0.19% lower, respectively. ICICI Bank, HDFC Bank and SBI Life Insurance were top laggards among Sensex stocks, while Kotak Mahindra Bank, Bajaj Finserv, Chola Invest and Power Finance were top gainers.

Tuesday Closing bell: Indices end with mild gains, broader markets outperform

The BSE Sensex closed at a high of 58,247 points, up 69 points, and the Nifty 50 rose 25 points to end at 17,380, a record closing high for the benchmark. Broader markets outperformed the benchmarks as both mid and small-caps were up 1% each.

Bank Nifty opened higher and made an intraday high of 36840 but failed to sustain higher levels. It closed with a gain of 0.38%, and Nifty Financial Services closed at 18,103, down 0.13%.

Weekly Market Wrap Up: Know how banks, financials performed this week

Wednesday Closing bell : Sensex, Nifty end at record closing highs

Headline indices Sensex and Nifty 50 ended at record closing highs, with both indices up nearly 1% each. The Sensex closed at 58,723 points, up 0.82%, while Nifty closed the day at 17,519, up 0.80%. BSE Midcap and Smallcap indices closed 0.65% and 0.86% higher, respectively.

Nifty Bank closed 0.65% higher at 36,852, while Nifty Financial Services ended at 18,158, up 0.30%. SBI, IndusInd Bank and HDFC were among the top gainers, while Axis Bank and HDFC Bank were among the top laggards.

PSU bank index jumped 2.83% with J&K Bank, Bank of Baroda, IOB, Indian Bank gaining 2.7% each.

Thursday Closing bell: Market closes at record highs again; banks, financials outperform ahead of FM announcement

Domestic benchmark indices ended at record closing highs on Thursday. Banks and financials outperformed all the sectors, ahead of Financial Minister Nirmala Sitharaman’s bad bank announcement.

BSE Sensex jumped 418 points to end above 59,100 mark for the first time at 59,141, while the Nifty 50 index ended at 17,629.50, rising 0.63%. BSE Midcap and Smallcap indices also hit their fresh record highs intraday, and closed 0.48% and 0.08% higher, respectively.

Among sectors, the Nifty PSU Bank index jumped 5.43%, while the Nifty Private Bank index clocked a gain of 2.67% . The Nifty Bank index rose 2.22%, while Nifty Financial Services gained 1.09%. Induslnd Bank emerged as the top gainer jumping 7% followed by SBI, Kotak Mahindra Bank, ICICI Bank, Axis Bank and HDFC Bank.

Friday Closing Bell: Sensex and the Nifty snapped 3-day winning streak, PSU banks gain

Having scaled fresh highs in early deals, benchmark indices lost steam as investors were seen booking profits after the three-day winning streak. Losses were led by PSU banks, auto, pharma stocks. BSE Sensex ended 0.21% lower at 59,016, while the Nifty 50 index fell 0.25% to settle at 17,585. BSE Midcap index fell 1.14% and the BSE Smallcap index closed 1.06% lower.

Bank Nifty ended at 37,811, up 0.38%, while Nifty Financial Services rose 0.65% ending at 18,476. Nifty PSU Bank index fell more than 3%, with Bank of Baroda losing 4.37%, by IOB, UCO Bank and Bank of India.

Key Industry takeaways

Retail inflation softens to 4-month low in August at 5.3%

Weekly Market Wrap Up: Know how banks, financials performed this week
Retail inflation based on Consumer Price Index (Combined) eased to a four-month low of 5.3% in August due to moderation in food prices along with a high base effect, data released by the National Statistical Office (NSO) on 13 September showed.

The August inflation print is within the targeted range of 2±4 per cent of the Reserve Bank of India (RBI) though this is the seventh consecutive month of an inflation print higher than 5 per cent and 23rd consecutive month of it being above the RBI’s target of 4%.

SREI’s Rs 35,000-crore loan may be classified as NPA

Banks may classify Rs 35,000 crore loan given to SREI group as Non Performing Asset (NPA) by the end of this quarter after the National Company Law Tribunal (NCLT) set aside the previous order restraining banks from such classification.

According to analysts’ estimates, Indian Bank and Canara Bank have exposures of Rs 2,000 crore and Rs 1,200 crore, respectively, to Srei group, while ICICI Bank and Axis Bank have Rs 800 crore each.

Sebi proposes to tighten timeline for filing settlement applications

The Securities and Exchange Board of India on Tuesday proposed to tighten the timeline of settlement mechanism, whereby it suggested fixing the total timeframe for filing the application at 60 days after receipt of the notice to show cause.

The total timeframe for filing the application for settlement may be fixed at 60 days of the date of receipt of the show-cause notice or the supplementary notice, whichever is later, Sebi said in a consultation paper.

Finance Minister Sitharaman announces bad bank

Weekly Market Wrap Up: Know how banks, financials performed this week
Finance Minister Nirmala Sitharaman announced the much-awaited bad bank on Thursday, and said that the Union Cabinet approved on Wednesday the sovereign backing of up to Rs 30,600 crore for the securities receipts.

The planned National Asset Reconstruction Company Ltd (NARCL) will issue securities receipts to banks as it takes on non-performing assets from their books. These securities receipts will be valid for five years.

Mahindra Finance enters vehicle leasing and subscription business

Mahindra & Mahindra Financial Services Ltd announced on Thursday, its entry into vehicle leasing and subscription business, under the brand name ‘Quiklyz’.

Under this model, consumers can pay a monthly fee to access a vehicle of their choice across all car brands, at a lower price as against regular ownership.

IDFC Board approves initiating steps to divest mutual fund business:

Weekly Market Wrap Up: Know how banks, financials performed this week
The board of directors of IDFC Ltd and IDFC Financial Holding Co Ltd at their meetings held on Friday have considered and approved to initiate steps to divest its mutual fund business subject to requisite regulatory approvals, as applicable.

The boards have authorised respective strategy and investment committees to take necessary steps, including appointment of investment banker, for the same.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , , ,

Finance Minister Sitharaman announces bad bank, Cabinet approves backing of up to Rs 30,600 crore on securities receipts, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


Finance Minister Nirmala Sitharaman today announced the much-awaited bad bank, and said that the Union Cabinet approved on Wednesday the sovereign backing of up to Rs 30,600 crore for the securities receipts.

The planned National Asset Reconstruction Company Ltd (NARCL) will issue securities receipts to banks as it takes on non-performing assets from their books. These securities receipts will be valid for five years.

“The idea behind it is to ensure value locked within assets is used making banking system robust. So limit provides an incentive for banks. If process delayed beyond 5 years, guarantee can’t be invoked,” Sitharaman said.

Read: What is a bad bank and why is it needed?

The NARCL will pay up to 15% of the agreed value for the loans in cash and the remaining 85% would be government-guaranteed security receipts, the finance minister announced. State-owned banks will hold 51% stake, while FIs or debt management companies will hold 49%.

Financial Services Secretary Debasish Panda said the government will not face any fiscal outgo for the guarantees it provides to banks. NPAs worth Rs 2 lakh crore will be sent to the NARCL, and of this Rs 90,000 crore will be transferred in the first phase.

Along with NARCL, the government will also set up an India Debt Resolution company. The service company will manage assets and loop in market professionals and turnaround experts. Public sector banks and public FIs will hold a maximum of 49% stake and the remaining will be held by private banks.

Watch: Bad bank can only be a warehouse of bad assets, says Siby Antony

The banks’ asset quality review had happened in 2015, which had revealed very high incidence of NPAs. After recognition, quantification of NPAs started in a planned manner and state owned banks, in the last six years, recovered Rs 5,01,479 crore, she said.

In 2018, just two out of 21 public sector banks were profitable. But in 2021, only two banks reported losses, Sitharaman added.

Watch: Bad bank to preserve value, timely sale of stressed assets: IBA CEO

During the Union Budget 2021-22, Sitharaman had announced the creation of NARCL or bad bank to resolve large cases of stress. The bad bank will manage and dispose the assets to alternate investment funds and other potential investors for eventual value realisation, she had said.

In August, the Indian Banks’ Association (IBA) moved an application to the Reserve Bank of India (RBI) seeking licence to set up a the Rs 6,000-crore bad bank. The NARCL was incorporated last month in Mumbai, following the registration with Registrar of Companies.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , , ,

Delay in legislation on crypto boosts lobbying, BFSI News, ET BFSI

Personal Finance

[ad_1]

Read More/Less


NEW DELHI: The delay in the government finalising the legislation on cryptocurrency has prompted intense lobbying, with agencies worried over the risks emanating from an unregulated segment with extreme price volatility, posing a threat to investors, many of whom do not understand the instrument.

Besides, there are concerns over the instrument being used for money laundering and terror funding, an issue that has been flagged by other agencies across the globe, sources told TOI.

While the Supreme Court had lifted the ban imposed by the RBI, the government had listed a bill on cryptocurrency to be introduced during the Budget session of Parliament but with the session cut short, the legislation could not make it.

During the monsoon session, the government remained silent on the future of the proposed bill with finance minister Nirmala Sitharaman recently saying that it has been sent for clearance by the Union Cabinet before it can be introduced in Parliament. The next session is at least two months away.

But crypto exchanges have used the interim period to launch a massive lobbying initiative with several governments and regulatory agencies, raising concerns. The exchanges have argued that a ban on digital currency transactions will result in job losses.

While there are fears that a ban will lead to investors getting locked into the instrument, sources indicated that a three-six month window will be provided for investors to exit.

Several officials have junked the argument that crypto currencies are an asset class. Besides, there are worries over the legal basis for the presence of some of the exchanges, which remain outside the jurisdiction of either Sebi or the RBI. “There has to be global coordination to combat the challenge posed by cryptocurrencies. They are not a currency as only the sovereign can issue currency. There is a grave danger in allowing these instruments,” said a source.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , ,

Cabinet secy-led panel holds crucial meeting on bank privatisation, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


New Delhi, Jun 27 () Inching a step closer to privatisation of two public sector banks, a high-level panel headed by the cabinet secretary recently held a meeting to thrash out various regulatory and administrative issues so that the proposal could be placed with the group of ministers on disinvestment or Alternative Mechanism (AM) for approval. Pursuant to the announcement made by Finance Minister Nirmala Sitharaman in her 2021 budget speech, the NITI Aayog has suggested a couple of bank names for privatisation to the Core Group of Secretaries on Disinvestment headed by Cabinet Secretary in April, sources said.

The meeting of the high-level panel deliberated on the recommendation of the NITI Aayog on Thursday June 24, sources said, adding the panel would after tying up all loose ends will send the names of the shortlisted PSU banks to AM for consideration.

Headed by the cabinet secretary, the members of the panel include secretaries in the departments of Economic Affairs, Revenue, Expenditure, Corporate Affairs and Legal Affairs, as well as the secretary of administrative department. The panel also has the Department of Public Enterprises, Department of Investment and Public Asset Management (DIPAM) secretary as its member.

According to sources, the panel also examined issues pertaining to protection of interests of workers of banks which are likely to be privatised.

Following a clearance from AM, it will go to the Union Cabinet headed by the Prime Minister for the final nod. Changes on the regulatory side to facilitate privatisation would start after the cabinet approval.

Central Bank of India and Indian Overseas Bank are reported to be probable candidates for privatisation.

The government has budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions, including two PSU banks and one insurance company, during the current financial year. The amount is lower than the record budgeted Rs 2.10 lakh crore to be raised from CPSE disinvestment in the last fiscal.

In her Budget Speech on February 1, Sitharaman had announced that the government proposes to take up the privatisation of two public sector banks (PSBs) and one general insurance company in the year 2021-22.

“Other than IDBI Bank, we propose to take up the privatisation of two public sector banks and one general insurance company in the year 2021-22,” she had said.

The government last year consolidated 10 public sector banks into four and as a result, the total number of PSBs came down to 12 from 27 in March 2017. The government has merged 14 public sector banks in the last four years.

Last year in April, the government effected the biggest ever consolidation exercise in the public sector banking space when six PSU lenders were merged into four in a bid to make them globally competitive. DP CS ANZ MKJ



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

Central Bank, IOB may be taken up for privatisation, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


NEW DELHI: The Centre may sell its stake in Central Bank of India and Indian Overseas Bank (IOB) as part of its mega privatisation initiative unveiled in the Union Budget in February.

While the two banks have been recommended for disinvestment by government think tank NITI Aayog, Bank of India (BoI) may be a potential candidate for sale, sources familiar with the deliberations told TOI.

The proposal from the government think tank is being vetted by the disinvestment and financial services departments, ministry sources said. The exercise is part of a multi-stage process for finalising entities that are to be taken up for privatisation.

While NITI Aayog has been tasked with recommending the names, it is then reviewed by the inter-ministerial group of officers and subsequently by a group of ministers, before the Union Cabinet puts its seal of approval.

Sources in the department of investment and public asset management (Dipam), which handles the government’s asset sales programme, said it will examine the proposal with the department of financial services and discuss the legislative changes needed for the privatisation of the state-run banks. “The timeline will depend on the legislative changes required,” the sources added.

Besides, the issue will have to be discussed in detail with the RBI as the law and regulations provide a special dispensation for state-run entities in several areas.

The Cabinet recently cleared the decks for the sale of government stake in IDBI Bank, but sale of the Centre’s holding in the two staterun entities will break new ground as the Narendra Modi administration has embarked on an ambitious privatisation drive, which for the first time includes the financial services space.

The government is hoping to conclude the sale of IDBI Bank stake during the current financial year.

Among the dozen staterun lenders, NITI Aayog had set its eyes on the six entities that were not part of the merger initiative a few years ago and included Bank of Maharashtra, Punjab & Sind Bank and UCO Bank in addition to BoI, IOB and Central Bank.

It, however, was of the view that the better off entities would attract greater interest, resulting in the shortlisting of IOB and Central Bank. Based on the current share price, the two entities are together valued at around Rs 44,000 crore with IOB’s market cap estimated at Rs 31,641 crore.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

Govt may table amendment to DICGC Act in monsoon session, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


In a bid to ensure timely support to depositors of stressed banks, the government may bring amendment to DICGC Act in the monsoon session with the objective to provide account holders easy and time-bound access to funds to the extent of the deposit insurance cover.

Last year, the government raised insurance cover on deposit five-folds to Rs 5 lakh with a view to provide support to depositors of ailing lenders like Punjab and Maharashtra Co-operative (PMC) Bank. Following the collapse of PMC Bank, Yes Bank and Lakshmi Vilas Bank too came under stress leading to restructuring by the regulator and the government.

The amendment to the Deposit Insurance and Credit Guarantee Corporation (DICGC) Act, 1961 is the budget announcement made by the Finance Minister and the Bill is almost ready, sources said.

It is expected that the Bill will be tabled in the upcoming monsoon session after being vetted by the Union Cabinet, sources added.

Once the Bill becomes the law, it will provide immediate relief to thousands of depositors who had their money parked in stressed lenders such as PMC Bank and other small cooperative banks.

As per the current provisions, the deposit insurance of up to Rs 5 lakh comes into play when the licence of a bank is cancelled and liquidation process starts.

DICGC, a wholly-owned subsidiary of the Reserve Bank of India, provides insurance cover on bank deposits.

Finance Minister Nirmala Sitharaman in the Budget speech in February said the government had approved an increase in the Deposit Insurance cover from Rs 1 lakh to Rs 5 lakh for bank customers last year.

“I shall be moving amendments to the DICGC Act, 1961 in this session itself to streamline the provisions, so that if a bank is temporarily unable to fulfil its obligations, the depositors of such a bank can get easy and time-bound access to their deposits to the extent of the deposit insurance cover. This would help depositors of banks that are currently under stress,” she had said.

It could not be presented in the Budget session due to curtailment of the last session following the spread of second wave of COVID-19 pandemic.

It is to be noted that the enhanced deposit insurance cover of Rs 5 lakh is effective from February 4, 2020. The increase was done after a gap of 27 years as it was static since 1993. The cover is provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a wholly-owned subsidiary of the RBI.

With increased insurance cover, the banks are paying a higher premium of 12 paise against 10 paise per Rs 100 deposited without any additional burden on account holders.

The deposit insurance scheme covers all banks operating in India, including private sector, cooperative and even branches of foreign banks. There are some exemptions such as deposits of foreign governments, deposits of central and state governments, and inter-bank deposits.

It can be recalled that way back in 2009, the Raghuram Rajan committee on financial sector reforms had recommended strengthening the capacity of the DICGC, a more explicit system of prompt, corrective action, and making deposit insurance premia more risk-based.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,

Finance Ministry to infuse Rs 3,000 crore in general insurance companies this quarter, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The Finance Ministry will infuse Rs 3,000 crore capital into state-owned general insurance companies during the current quarter in a bid to improve their financial health. Last year, the Union Cabinet headed by Prime Minister Narendra Modi cleared proposal to provide capital support to National Insurance, Oriental Insurance and United India Insurance.

The cabinet had also decided to increase the authorised share capital of National Insurance Company Limited (NICL) to Rs 7,500 crore and that of United India Insurance Company Limited (UIICL) and Oriental Insurance Company Limited (OICL) to Rs 5,000 crore each to give effect to the capital infusion decision.

Recently, the government sought Parliament nod for gross additional expenditure of Rs 6.28 lakh crore for 2020-21 as part of second and final batch of supplementary demands for grants.

This included Rs 3,000 crore for providing additional funds towards recapitalisation of insurance companies.

The infusion will be done after the supplementary demands for grants is passed by Parliament which will reconvene on March 8.

The capital infusion will enable the three public sector general insurance companies to improve their financial and solvency position, meet the insurance needs of the economy, absorb changes and enhance the capacity to raise resources and improve risk management.

Finance Minister Nirmala Sitharaman in the Budget announced privatization of two public sector banks and one general insurance company in 2021-22 beginning April.

In 2017, state-owned companies New India Assurance Company and General Insurance Corporation of India went public.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,

IRFC IPO to raise Rs 4,600 cr; issue opens on Jan 18, BFSI News, ET BFSI

Personal Finance

[ad_1]

Read More/Less


The initial public offering (IPO) of Indian Railway Finance Corporation (IRFC) worth about Rs 4,600 crore will hit the market on January 18, Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said on Wednesday. “IRFC coming up for listing with a Rs 4600 cr+ issue in a price band of Rs 25-26 per share. Anchor book on Jan 15 and the main book from Jan 18-20,” he tweeted.

This will be the first IPO by a railway non-banking financial company (NBFC).

In January 2020, IRFC had filed draft papers for its IPO.

The issue is of up to 178.20 crore shares, comprising a fresh issue of up to 118.80 crore shares and offer for sale of up to 59.40 crore shares by the government, according to the draft prospectus.

The company’s principal business is to borrow funds from the financial markets to finance acquisition/ creation of assets which are then leased out to the Indian Railways.

IRFC, set up in 1986, is a dedicated financing arm of the Indian Railways for mobilising funds from domestic as well as overseas markets. Its primary objective of IRFC is to meet the predominant portion of ‘extra budgetary resources’ requirement of the Indian Railways through market borrowings at the most competitive rates and terms.

The Union Cabinet had in April 2017 approved listing of five railway companies. Four of them — IRCON International Ltd, RITES Ltd, Rail Vikas Nigam Ltd and Indian Railway Catering and Tourism Corp — have already been listed.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , ,