State General Reserve Fund of Oman (SGRF), a sovereign wealth fund, and State Bank of India will infuse $150 million and $50 million, respectively, in private equity fund Oman India Joint Investment Fund (OIJIF). This decision is driven by performance in the first fund and the capital requirement for mid-size companies in the country. OIJIF, a mid-market India focused private equity fund, has announced the first close for its second fund, OIJIF Fund-II, at $220 million. OIJIF Fund-II is targeting a corpus of $300 million by the end of 2017. Keeping in line with the larger fund corpus, OIJIF will look to make larger ticket size investments from this fund. The first fund, of $100 million, has been fully invested across seven companies and has returned around 50 per cent of capital by divesting around 15 per cent of its investment.
Source: Business Standard, January 14, 2017
Mortgage lender Indiabulls Housing Finance has concluded three commercial lease rental discounting transactions for Rs 1,700 crore of loans over the last one quarter. The non-banking finance company lent against two office properties and a retail mall of Mantri Developers, ASF Group and Ambience. The three income-producing properties spread over total 4.2 million square feet have an annual rental income of around Rs 350 crore. Of the three income-producing properties, Mantri Square Mall, with an area of more than 1 million square feet is in Bengaluru. The asset generates an annual rent of Rs 150 crore and tenants like Marks & Spencer, Reliance Retail, Max Hypermarket India, Lifestyle International, Pantaloons Fashion & Retail and Shoppers’ Stop.
Source: The Economic Times, January 17, 2017
State Bank of India (SBI), raised $500 million by selling five-year bonds to investors in Europe and Asia, having last sold similar instruments in 2014. The offer that opened for subscription was priced at 145 basis points over five-year US Treasury bonds which were trading at 1.85 per cent. The five-year securities that are known as Regulation S bonds have been issued under SBI’s $10 billion Medium-Term-Note (MTN) programme through its London branch and listed in Singapore. The proceeds will be used to lend to Indian companies abroad. The final pricing of the bond was much below the initial guidance of 170 basis points. Citibank, Bank of Tokyo-Mitsubishi UFJ, DBS Bank, HSBC and SBI Capital Markets are among those managing the sale. The deal saw a strong interest from investors across geographies.
Source: The Economic Times, January 18, 2017
The Debt Recovery Tribunal (DRT) has ordered the State Bank of India (SBI)-led consortium of banks to start the process of recovering Rs 6,203 crore, at an annual interest rate of 11.5 per cent, from tycoon Vijay Mallya and his companies in the Kingfisher Airlines case. The DRT also disposed of 20 Interlocutory applications, including several by Mallya and his companies. The order brings an end to the nearly three-year legal battle in the Tribunal by the consortium, comprising 17 banks, to recover the money owed to them by the defunct airlines. The lenders had moved the DRT in 2013 to recover dues from the airline. SBI had also filed three other applications including one seeking Mallya's arrest and impounding his passport, for defaulting on loans.
Source: The Economic Times, January 20, 2017
Banks’ Q3 results
|Bank||Net Profit (Q3 FY17) crores||Net Profit (Q3 FY16)||NII (Q3 FY17)||GNPA (in percentage)|