A recent press report said that State Bank of India is not looking to sponsor an infrastructure debt fund (IDF), a new vehicle that was mooted in Budget 2011-12 to enhance the flow of long-term debt for funding infrastructure development.
Mr. Pratip Chaudhuri, SBI Chairman, told the press that the bank was not planning to sponsor an infrastructure debt fund because the bank’s books itself is lending so much to the leading companies whether it is in ports or telecom or power sectors on the infrastructure side. He said that the bank was not facing a shortfall or inadequacy in lending to infrastructure.
Reports said that SBI’s total infrastructure outstanding was at Rs 77,000 crore as of end June 2011 out of which power sector accounts for Rs 37,000 crore, roads Rs 9,000 crore on the infrastructure side, telecom Rs 10,000 crore, ports about Rs 3,000 crore and educational institutions about Rs 4,000 crore.
Reports also said that the Finance Ministry had recently come out with the guidelines allowing IDFs to be established either as trusts or as companies. The guidelines stipulated that banks and financial institutions can only be sponsors of IDFs and that they cannot directly invest in the bonds issued by these funds.
The bank has recently hiked its lending rates making it home loan and other loan dearer to its customers.