PFC plans to buy stake in a PSB, seeks ministry nod

Written by Press Trust of India | New Delhi | Updated: May 31 2013, 06:11am hrs
Power Finance Corp plans to acquire a substantial stake in a public sector bank and has sought approval for the proposal from its parent power ministry.

The state-run major, which is providing funds to the power and related sectors, is keen on entering the banking arena. PFC is exploring the possibility of acquiring a substantial stake in a public sector bank. We have approached the power ministry with the proposal about a month ago, PFC chairman and managing director Satnam Singh said on Thursday.

Without divulging specific details, he said the power and finance ministries are examining the companys proposal. On how much stake PFC is looking to acquire, Singh said the company was eyeing a substantial stake that would allow it to have a board member in the bank.

The Reserve Bank of India (RBI) had come out with guidelines for new bank licences in February and the aspirants have to submit applications by July 1.

Separately, PFC expects to soon launch a $1 billion-private equity fund exclusively for the power sector along with Tata Capital.

The initial investment would be around $300 million, he said announcing the results for the financial year 2012-13. In the joint venture, Tata Capital would have 51% shareholding and the rest would be with PFC.