NEW DELHI: Power Finance Corporation (PFC) has successfully secured a $1.265 billion foreign currency term loan, marking the largest loan ever obtained by an Indian public sector undertaking (PSU).
This significant funding will be directed towards financing green energy projects and expanding PFC’s operations.
New Delhi, Oct 4 (PTI) – State-owned Power Finance Corporation (PFC) announced on Friday that it has completed the issuance of a USD 1.265 billion foreign currency term loan, the largest for any Indian PSU to date.
The loan was arranged through a facility agreement with several banks operating in the International Financial Services Centre (IFSC) in GIFT City, Gandhinagar, according to a company statement.
Fund utilisation
This multi-currency funding will allow PFC to broaden its operations, enhance its market presence, diversify its funding sources, and maintain a competitive advantage.
PFC plans to utilise the loan primarily for financing assets other than thermal generation projects, reinforcing its commitment to de-carbonisation and the transition to renewable energy.
The loan features a floating interest rate currently averaging 4.21 per cent per annum and is denominated in G3 currencies – USD, EUR, and JPY.
It has a five-year tenor and is linked to external benchmark rates, including the Secured Overnight Financing Rate (SOFR) for USD, the Euro Interbank Offered Rate (EURIBOR) for EUR, and the Tokyo Overnight Average Rate (TONA) for JPY.
SBI, IDBI, Axis, MUFG, Deutsche Bank, and SMBC acted as bankers for this issuance, with SBI serving as the largest lender and facility agent for the transaction.
