Rediff Logo
Home > Money > Reuters > Report
October 24, 2002 | 1839 IST
  Money Matters

 -  Business News Archives
 -  Corporate News Archives
 -  Business Special
 -  Columns
 -  IPO Center
 -  Message Boards
 -  Mutual Funds
 -  Personal Finance
 -  Stocks
 -  Tutorials
 -  Search rediff


 Secrets every
 mother should

 Your Lipstick

 Need some
 Extra Finance?

 Bathroom singing
 goes techno!

 Search the Internet
 Sites: Finance, Investment

Print this page Best Printed on  HP Laserjets
E-Mail this report to a friend

Govt mulling revival package for IFCI

The government is discussing a restructuring package for cash-strapped state-run term lender IFCI Ltd but no decision has been reached, a senior official said on Thursday.

"We are still discussing different possibilities but nothing has been finalised," the finance ministry official, who did not wish to be identified, told Reuters.

Domestic newspapers have said the government was expected to announce a bailout package this week for the domestic financial institution which is saddled with bad debts.

The government has said it is concerned about IFCI's liabilities involving foreign borrowings, retirement funds and retail investments.

IFCI, set up in 1948, was India's first financial institution established to provide credit to medium and large industry.

Any bailout would be the second in two years for the troubled lender. In 2001, the government approved a Rs 1,000-crore (Rs 10-billion) capital infusion for IFCI to boost its capital adequacy ratio.

In August, India announced a comprehensive bailout package for state-run mutual fund manager Unit Trust of India, covering a massive shortfall in its ability to repay investors in assured return schemes.

UTI, which manages half the Indian mutual fund industry's assets of about $20 billion, stunned investors last year when it froze redemptions from its flagship fund, US-64, for the rest of 2001.

The official added the government was "looking at ways to strengthen" another state-run term lender, the Industrial Development Bank of India, also hit by bad debts.

"We're not working out a bailout package for IDBI. It doesn't need one," he said.

More Money Headlines

Back to top
(c) Copyright 2002 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Tell us what you think of this report