Companies & Sectors
Suzlon moving CDR cell to give lenders time to sort issues: SBI

Noting that Suzlon case is much different from that of Kingfisher, SBI chairman said the wind-turbine maker's is a much different case as it is a running company and has operations globally

Gurgaon: State Bank of India (SBI), the major lender for debt-laden Suzlon, has said the wind turbine maker's move to approach corporate debt restructuring (CDR) cell would give more time for lenders to sort out the issues, reports PTI.


Loss-making Suzlon Group last month said it has started discussions with lenders for restructuring debt, including a two-year moratorium on repayment of term loans.


"I think reference to the CDR cell gives the bankers more time to iron out these issues and Suzlon's financials are a little more complex," SBI Chairman Pratip Chaudhuri told reporters on the sidelines of the World Economic Forum on India summit.


Suzlon has a debt burden of over Rs13,000 crore including foreign currency convertible bonds (FCCBs) obligations. A few weeks back, bondholders had rejected its proposal seeking four-month extension to repay overseas debt worth about $221 million.


Noting that Suzlon case is much different from that of Kingfisher, Chaudhuri said the former "is a much different case, it is a running company and has operations globally".


"Whatever little I understand is that they (Suzlon) took lot of short term debt...," he added.


SBI is estimated to have an exposure of about Rs3,500 crore to Suzlon.


Talking about Suzlon, he said that its business model is such that "when you build a wind energy farm, the payment would come after a long period of time of 15-20 years, which they financed out of 3-5 years, so it is more a mismatch than I would say an insolvency issue".


According to Chaudhuri, SBI is quite confident about Suzlon's technological capabilities while recognising the challenging global environment.


"So, how the company manages the technological issues with the financing issues, that would need more in depth discussions," he said.


Last month, SBI had suggested merger of Suzlon's German arm REpower with the group to improve profitability.


"They (Suzlon) have global subsidiaries (but) to what extent those global subsidiaries can be brought in together, to what extent you can use the surplus cash lying in one subsidiary to fund the another... so those are some of the issues," he noted.


State Bank of India may reduce lending rate in next 2-3 weeks

SBI last reduced its base rate in September, and its chairman expect the bank's asset liability committee to decide on reducing lending rates over next two-three weeks

Gurgaon: State Bank of India (SBI) has indicated it could reduce lending rates in the next two-three weeks to boost credit growth, reports PTI.


"We had an asset liability committee (ALCO) meeting and there we did not cut the rates, but I am not ruling that out (rate cut). It could happen in the next two to three weeks," SBI Chairman Pratip Chaudhuri told reporters on the sidelines of World Economic Forum on India summit.


"Our rates are the best in the industry today, particularly from consumer finance, home and auto," he added.


SBI last reduced the base rate or the minimum lending rate in September this year. The base rate of SBI is presently pegged at 9.75%.


Chaudhuri emphasised that there has been a strong co- relation between the reduction in interest rates and rise in demand for advances.


"We will see how the loan growth picks up. We are seeing a very strong co-relation as you drop the rates, the loan demand picks up very strongly," he said, adding that he would not be surprised if the home loan segment picked up by over 30% in the current fiscal.


Last month, RBI in its half yearly review of monetary policy left the key interest rate unchanged but reduced cash reserve ratio by 0.25% to infuse additional liquidity that will inject Rs17,500 crore into the financial system.


Driven by huge inflow of deposits, SBI is currently having surplus liquidity of Rs60,000-Rs70,000 crore.


Romney campaign fund gets Rs3.52 lakh from hacked account

Patna-based doctor's Axis Bank account was hacked and the money was transferred to Romney's campaign fund bank account in San Francisco

Patna: A doctor's account from a private bank in Patna was hacked and Rs3.52 lakh transferred to the account of defeated US presidential candidate Mitt Romney's campaign fund bank account, reports PTI quoting a police official.


The bank account of Dr Sushil Kumar Verma in Axis Bank, Boring Road branch, was hacked on 10th October and Rs3.52 lakh transferred to Romney's campaign fund bank account in San Francisco, Srikrishna Puri police station SHO Sanjay Pandey said.


Verma, a resident of North Krishna Puri locality, received a message on his cell phone about debit of the amount from his account, Pandey, who is the investigation officer in the case, said.


Bihar DGP Abhayanand, confirming the cyber crime, said a case has been registered and investigation was in progress.


The doctor has since blocked his account.


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