Power Finance Corporation (PFC) has started the exercise to appoint a consultant, which will advise it whether it is a feasible idea for the state-owned firm to set up up a bank.
?We are likely to appoint a consultant, out of 2-3 proposals received by us.We are evaluating the proposals and it will take us 15 days from now in the finalisation of the consultant. ? said Satnam Singh, chairman & managing director of PFC.
Though there is no dearth of funds for PFC as it is already the member of lenders’ club which comprises 18 banks, Life Insurance Corporation (LIC) and HUDCO, the proposed bank would equip the company to lend to power developers. Also, it would be the part of diversification of PFC’s portfolio, added Singh.
Singh said that the government has given its approval last week for the company’s follow-on public offer (FPO). ?The exact amount to be raised through the FPO would be ascertained only after the empowered group of ministers decides the offer price. The FPO is likely to hit the markets during early next financial year,? said Singh.
The size of the bonds, the issue for which opens on Feb 24 and would close on March 22, was Rs 5,300 crore. It will have a fixed interest rate of up to 8.5% and shall be payable on annual or cumulative basis.