Nabfid eyes Rs 60,000 crore loan book, Rs 1 lakh crore sanctions by March 2024

Mumbai, Jun 20 (PTI) Infrastructure lender National Bank for Financing Infrastructure & Development (Nabfid) is looking at disbursing around Rs 60,000 crore by the end of this fiscal, having lent Rs 8,000 crore already in the first quarter, a top official has said.

The central government-backed infrastructure financier, which began operations less than year ago, is also looking to sanction Rs 1 lakh crore loans this fiscal to both greenfield as well as brown-field assets in the key infra space, Rajkiran Rai G, managing director, told PTI here on Tuesday after listing its maiden Rs 10,000-crore bonds on the BSE.

Last week, the lender had raised Rs 10,000 crore through debt issuance, which has received close to five times more bids worth Rs 23,629.50 crore, as the base issue was Rs 5,000 crore.

The issuer is offering 7.43 per cent annually to the investors in the unsecured non-convertible debt securities of 10 year-tenure. This is the largest debt issuance by a national-level financial institution.

“We had disbursed Rs 18,000 crore last fiscal and have already done Rs 7,000 crore so far this fiscal. We hope to close the year with around Rs 60,000 crore of loan book, and sanction around Rs 1,00,000 crore,” Rai said exuding confidence from the huge institutional interest in the country’s infrastructure.

He said while overall 60 per cent of the funding has been to public sector assets, in the June quarter, the entire disbursal has been to the private sector and going forward, he expects the allocation to the private sector to go up.

Nabfid lends to rated infra assets both new and operational in green energy along with thermal plants, data centres, city gas distribution, roads, both toll-roads and HAM (Hybrid Annuity Model) projects, Invits, transmission lines among others.

Typically 30 per cent of its funding now goes into greenfield assets, 20 per cent into asset monetization and the rest in funding terms loans to operational assets. For new projects it can lend up to 30 years or the life of the concession period and for operational assets it could be term lending which could vary from 1 year and up to the life of the reminder of the concession period, Raj said.

Raj said Nabfid is also looking at airports segment as and when there is an opportunity as all the oncoming airports are financially secured now.

Nabfid prices its one-year term loan, which it calls Nabfid lending rate or NLR, at 7.90 per cent, as it gets comparatively cheaper funds from the banks and debt investors given its sovereign guarantee leveraging on the Rs 20,000-crore equity capital and the additional Rs 5,000 crore special grant the Centre has given, Raj said.

When asked whether Nabfid will launch tax-free bonds for retail investors, he said not in the immediate future as the mandate is to raise long term funds from institutional investors.

On further fund raising plans, he said he is looking at tapping multilateral agencies and has already signed an agreement with IFC to offer transaction advisory services to the World Bank arm.

The agreement with the International Finance Corporation seeks to offer transaction advisory services for developing public-private partnership projects. The initial projects are expected to mobilize around USD 2 billion in private investment over the next few years in national priority sectors, including renewable energy, energy storage, and urban infrastructure.

Nabfid has the mandate to develop long-term non-recourse infrastructure financing thus deepening the bond market.