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Rediff.com  » Business » Citigroup to buy 5% SMERA pie

Citigroup to buy 5% SMERA pie

February 08, 2006 19:00 IST

Citigroup will pick up 5 per cent stake in SMERA, a rating agency for small firms, and have a strategic tie up.

Citicorp Finance (India) Ltd on Wednesday signed an MoU with SMERA to jointly promote the interests of the Indian SME sector and maximise business opportunities for mutual benefit.

Leveraging on Citigroup's domestic and international experience and understanding of the SME business, Citigroup and SMERA will closely collaborate to introduce global best practices in financing for SME businesses in India.

Citicorp Finance (India) Ltd will also pick-up a 5 per cent stake in SMERA, Citigroup said in a release.

With this, Citigroup has become the first multinational bank to enter into such a strategic partnership with SMERA.

"Citigroup, brings the ideal combination of international financial expertise and in-depth understanding of local issues," SMERA CEO Rajesh Dubey said after signing the MoU. Abhijit Sen, CFO, Citigroup India, said: "Despite intrinsic strengths, credit penetration among SMEs is low and they face many challenges in accessing quality credit."

SMERA can play an important role in filling these lacunae as a nodal credit rating agency, he said.

"The SME segment constitutes an important initiative for Citigroup and through its participation in SMERA, Citigroup seeks to bring its expertise in other markets and geographies to India," he said.

SMERA is a joint initiative by Small Industries Development Bank of India (SIDBI), Dun & Bradstreet Information Services India Private Limited (D&B), Credit Information Bureau (India) Limited (CIBIL) and several leading banks in the country.
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