JOIN USFour financial institutions -- Bank of Baroda (BoB), ICICI Bank, LIC and Citi Financial -- today agreed to form the country's first USD 2 billion (about Rs 10,000 crore) Infrastructure Development Fund (IDF) to finance infrastructure projects in the country.
"This is the first IDF and will have an equity capital of Rs 300 crore. It will start operations in the next fiscal (beginning April 1, 2012) ... Total fund size would be USD 2 billion", Bank of Baroda (BoB) Chairman M D Mallya told reporters here.
An MoU to set up the fund was signed by the representatives of the banks and financial institutions including Bank of Baroda (BoB) chief Mallya and ICICI Bank CEO and managing director Chanda Kochhar in presence of Finance Minister Pranab Mukherjee.
ICICI Bank, the sponsor of the joint venture, will hold 31 per cent equity in the IDF followed by Bank of Baroda (30 per cent), Citi Financial (29 per cent) and LIC (10 per cent).
The ICICI Bank has already received the Reserve Bank's in-principle nod to set up the IDF through the NBFC (non-banking financial company) route last month. An IDF may be set up either as a trust or non-finance company. While the trust-based IDF (Mutual Fund) would be regulated by Sebi, an IDF set up as a company (NBFC) would be regulated by RBI. According to RBI guidelines, IDFs to be set up as NBFCs should have a minimum net-owned fund of Rs 300 crore.