IFC open to tie-up with Religare in banking foray
The multi-lateral agency has already invested $400 million in companies like Powergrid Corp and Inox. On Thursday, IFC announced a $75-million (R405 crore) investment in compulsorily convertible debentures of Religare Enterprises. After the conversion of these debentures into equity in about 18 months, IFC will own 8% stake in REL.
IFC Asia director for financial markets, Serge Devieux, said the institution was open to more investment in Religare. “We are always open to partnership in Religare for banking foray,” he said.
REL CEO Shachindra Nath said the company would apply for a banking licence when the RBI starts the process. RBI will initiate the process after the Banking Regulation Act is amended to empower it to supersede bank boards and regulate acquisitions in banks. In the past, IFC have picked up stakes in new-generation banks like HDFC, IDFC and ING Vysya. It now has a 5% stake in Federal Bank.
The company was also eager to pump in more money, either through debt or equity, in the Religare group companies, wherever it is permissible, he added.
Though IFC can't extend a loan to REL as external commercial borrowing is not permitted for NBFCs, Devieux said it can extend loans for low-cost housing.
REL will look to IFC advise in expanding the business in low-cost housing, agri value
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