Rajasthan State Industrial Development

& Investment Corporation Limited

Udyog Bhawan, Tilak Marg, JAIPUR - 5

 

 

No. FDI/I&A/IDBI/91

Dated: January 18, 2007

 

 

OFFICE ORDER

 

Sub:     Rationalization of Interest Rate Structure of Term Loan

 

            The management of the Corporation has decided to rationalize Interest Rate Structure of Term Loan as under:

 

  1. Increase in the lending rate of interest from 13.00% to 13.50% by which the net rate of interest of the Corporation for projects after allowing rebate for timely payment would be 11.00%.

 

  1. Exclude real estate projects getting benefit of Good Borrower Scheme (commercial/residential complexes - for land, construction and other project components).  This will make net interest rate of 11.00% to all projects of real estate, irrespective of their past track record.

 

  1. Adopt a single good borrower scheme by merging the existing good borrower category A and good borrower category -B schemes such that the net-worth & turnover of borrowers should be minimum of Rs. 1.00 crore each.  The documented interest rate would be 1.00% less than the lending rate. The existing Good Borrowers of the Corporation as well as of other Financial Institutions classified as Standard Assets, as on close of the financial year will be eligible.

 

The eligibility and other terms & conditions of the scheme will be as follows :

 

i)       The term loan under consideration shall not be less than Rs. 50.00 lacs.

ii)     The net worth of applicant is not less than Rs. 1.00 crore and turnover of the company/concern is not less than Rs. 1.00 crores as per last audited annual accounts.

iii)    The company/concern should have good financial position and track record of consistent turnover and cash profits during preceding three years.

iv)   The company shall have satisfactory repayment record with the financial institutions /banks, with whom the company has dealt in past three (3) years..

v)     The portion of plant & machinery and miscellaneous fixed assets in the scheme shall be secured additionally by collateral security.  The value of such collateral security will be in the same ratio in which the term loan is being considered for financing the project.

                                  OR

The promoter's contribution in the proposed project should be minimum 30% of the project cost.

                                                                        OR

           The overall debt to equity ratio of the company/concern should not exceed 1.25:1.

 

Revised Interest Rates

 

After the revision, the Interest Rate Structure of the Corporation would be as under:

 

 

S.No.

Particulars

RIICO's lending rate

Documented rate of interest

Net rate of interest after allowing 2.50% rebate for timely payment

1.

All projects under various schemes

13.50%

13.50%

11.00%

2.

Real estate projects

13.50%

13.50%

11.00%

3.

To Good Borrowers (excluding real estate projects)

13.50%

 

12.50%

 

10.00%

 

4.

Short term loan

13.50%

12.50%

 10.00%

 

 

 

The above order shall be effective from January 18, 2007 for new sanctions of loans.

 

 

 

                                                                                                             ( Ajit Singh )

Financial Advisor