IDBI has planned to raise funds through MTN

By | September 4, 2011

A recent press report said that IDBI bank has planned to raise $1 billion of debt from abroad over the coming twelve months.

Mr. R. M. Malla, Chairman and Managing Director of IDBI said that this overseas borrowing which is to be done through medium term note (MTN) would be in tranches. A MTN note would mature within a period of 5 to 10 years. This kind of debt program would facilitate the bank to acquire constant cash inflow through the issuance of the debt instruments.

IDBI Bank’s board has already given consent to raise $1.5 billion fund through MTN note. The bank has risen around $350 million fund through MTN last year by issuing bonds with a maturity period of 5.5 years.

Regarding branch expansion, Mr. Malla said that the bank has planned to set up at least 200 branches it the next twelve months. This expansion would help in enhancing the current account and savings account (CASA) deposits.

The bank has a branch network of about 930 branches and currently has around 14, 000 employees. The bank has also planned to recruit 2,800 to 3000 people in the next twelve months. It is also intending to bring down its bad loan portfolio and improve the overall quality of its assets. The loan portfolio of the bank includes home loan, personal loan, auto loan, reverse mortgage loan, education loan etc.

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About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

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