A recent press report said that SBI is not considering sponsoring an infrastructure debt fund (IDF) which is a new vehicle to enhance the flow of long-term debt for funding infrastructure development promoted in Budget 2011-2012.
Mr.Pratip Chaudhuri, Chairman said that the Bank is not considering it because already on the infrastructure side, the bank is lending to the leading companies in ports, telecom and power sector and there is no short fall in the lending to infrastructure. Further he also added that the bank will be selective company-wise and not sector-wise.
The report further stated that the total outstanding with reference to the infrastructure stood at Rs.77,000 crore as of June 2011 of which the power sector accounts for Rs. 37,000 crore, roads at Rs.9,000 crore, telecom Rs. 10,000 crore, Port Rs.3,000 crore and Educational institutions about Rs.4,000 crore.
The report also clarifies that as per the guidelines issued by the Finance Ministry on June 24 with reference to the IDFs stipulated that the Banks and Financial Institutions can be sponsors of IDFs and cannot directly invest in the bonds issued by these funds. Further the Finance ministry allows IDFs to be established either as trusts or as companies.
The bank has recently hiked its interest rate making its loans such as home loan, personal loan, auto loan etc costlier.