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Banks help ease IFCI loan burden

New Delhi, July 6 (PTI): Banks and financial institutions will help Industrial Finance Corporation of India (IFCI) reduce its interest costs by recasting debts worth over Rs 2,700 crore.

According to the debt restructuring scheme, the maturity period of the statutory liquidity ratio (SLR) bonds issued by IFCI to banks and FIs have been extended by 10 years and the interest rate reduced from 11.5-13.5 per cent to the prevailing rates (at about 6-7 per cent) on government securities, sources said.

The move comes days after Employees Provident Fund Organisation agreed for partial roll-over of IFCI’s debts worth over Rs 1,000 crore by extending the maturity period of non-SLR bonds by 10 years and reducing the interest rate to 10 per cent from 12-14 per cent.

The government and stakeholders approved IFCI’s plan to recast its liabilities worth over Rs 12,000 crore last fiscal to pull up the country’s oldest financial institution out of the red.

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