Financial Daily from THE HINDU group of publications
Thursday, Jun 30, 2005
Money & Banking
Industry & Economy - SSI
SIDBI ties up with UCO Bank
Kolkata , June 29
THE Small Industries Development Bank of India (SIDBI) has started negotiations with KfW for a euro 40-million line of credit, which will be part of its overall plan to mobilise resources during the current fiscal.
SIDBI, which expects to have a direct credit exposure of Rs 5,000 crore by end-March 2006, is planning to raise substantial funds over the next few months. As much as $120 million has been tied up, courtesy World Bank; of this, $40 million has been drawn already. Additional resources have also been finalised with the Department for International Development (DFID) of the UK.
SIDBI, which signed an MoU with UCO Bank today to increase the flow of credit to SMEs, has decided to forge similar arrangements with a couple of other banks, said Mr N. Balasubramanian, its Chairman and Managing Director. Indian Bank and Oriental Bank will soon join the entities Bank of India (BOI) and UCO Bank it has already tied up with, he added.
"We are seeking to disburse a major amount through these arrangements. As many as 11 branches of BOI are already covered under the plan. With UCO, we hope to start with nine branches," he told newspersons on Wednesday.
The SIDBI chief, while referring to the government's recent thrust on SME financing, underlined the significance of adopting the `cluster approach'. He also focused on appreciating "specific and unique" problems that small entrepreneurs may be facing in their business.
On another front, SIDBI is stressing on supporting micro-finance organisations, including those in the North-East. The aim is to support tiny enterprises run by those who need institutional backing.
More banks to join SIDBI-backed agency
A number of banks, including ICICI Bank, PNB and Canara Bank, may join the credit rating outfit that has been mooted by SIDBI along with CIBIL (Credit Information Bureau India Ltd) and Dun & Bradstreet, Mr N. Balasubramanian indicated.
Talks with these banks are now being conducted at various levels, he said, adding that SIDBI may consider retaining 50 per cent of the rating agency. The rest will be farmed out among the institutions joining in.
The rating agency, which will cater to the SME segment, will not have a public character it will not be like Crisil, Icra or Care, the agencies that have been operating in India for some time now.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line