Rural Electrification Corporation Limited (REC) on 11 March 2013 signed a bilateral term-loan agreement worth 250 million US Dollars or 1350 crore Rupees approximately, with the State Bank of India at Hong Kong.
The funding for the agreement will be done by the offshore branch of State Bank of India, which is also the only lender. The bilateral term-loan agreement was exchanged between REC Chairman Rajeev Sharma and the officials of SBI.
Proceeds of this loan will be used by Rural Electrification Corporation Limited for Infrastructure Power Sector.
The loan will also have a floating interest rate to 6 -month LIBOR. It also has door-to-door maturity of 3 years. LIBOR means the rate of interest charged by the top-quality banks on each other for the loans.
With the signing of this bilateral term-loan agreement, REC has completely made use of the External Commercial Borrowings equal to 750 million US dollars, which was sanctioned by Reserve Bank of India under approval route in 2012-13 financial year.
At present, Rural Electrification Corporation Limited (REC) is involved in financing the power projects in primarily rural India.
Where: Hong Kong
When: 11 March 2013