The Hindu : $200 m IFC loan for HDFC

Online edition of India's National Newspaper
Saturday, Jun 28, 2003

Business

Business

$200 m IFC loan for HDFC

By Our Staff Correspondent

MUMBAI JUNE 27 . Housing Development Finance Corporation has signed a loan agreement for $200 million (in two tranches) with the International Finance Corporation (IFC), Washington, the private sector development arm of the World Bank group, in New Delhi on June 26.

The loan from IFC is being availed of in two tranches.

The first tranche Loan A of $100 million is being lent directly by the IFC as a multilateral tranche and Loan B of $100 million is a syndicated tranche.

Loan A has a bullet maturity at the end of eight years and the rate of interest is $6 month LIBOR plus 100 basis points. Loan B of $100 million will be syndicated by the IFC and placed with leading international banks.

The syndication process will be shortly completed.

The main objective of the loan is to broad base the medium to long-term funding sources for HDFC and also to reduce the overall cost of funding.

The proceeds of the loan will be utilised for on lending to individuals across the country for residential housing.

As in previous international borrowings, HDFC will cover the foreign exchange risk on the borrowing. HDFC is in the process of finalising suitable risk management arrangements to hedge against foreign exchange fluctuations.

Printer friendly page
Send this article to Friends by E-Mail

Business