REC granted infrastructure finance company status
20 Sep 2010
Rural Electrification Corporation has said that the Reserve Bank of India(RBI) has granted it the status of infrastructure finance company which would allow it to increase its lending to power projects.
In a statement the company said it can now take an additional lending exposure of up to 5 per cent of its owned funds in case of a single borrower and up to 10 per cent of its owned funds in case of a group of borrowers taking the permissible exposure to 40 per cent of owned funds in case of a group of borrowers.
The corporation also becomes eligible for issuance of infrastructure bonds and for raising funds up to $500 million (Rs2,500 crore approximately) through external commercial borrowings in a year.
REC finances power generation, transmission and distribution projects in the country.