The Infrastructure Development Finance Company Ltd (IDFC) will soon raise Rs 1,000 crore as equity capital. In addition, the Reserve Bank and the government will pump in Rs 700 crore in equal proportion as subordinated debt to form the tier II capital.
The IDFC board of directors of directors met for the first time in Chennai yesterday. The board appointed Deepak Parekh, chairman of Housing Development Finance Corporation (HDFC), as the non-executive chairman of the company. The other directors on the board are CM Vasudev, additional secretary (banking division), ministry of finance, Jagdish Capoor, deputy governor of the Reserve Bank of India (RBI), GP Gupta, chairman of Unit Trust of India (UTI), KD Agrawal, chairman of Industrial Finance Corporation of India (IFCI), Lalita Gupte, deputy managing director of Industrial Credit and Investment Corporation of India (ICICI), and AKT Chari, chief general manager of Industrial Development Bank of India.
Initially, the major shareholders of IDFC will be the Government of India, RBI, IDBI, UTI, IFCI, ICICI and HDFC.
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According to a press release issued by IDFC, the overseas institutions including multilateral agencies will pick up 30 per cent of the equity capital. The government, RBI and the FIs will pick up 40 per cent of the capital while the commercial banks will pick up 30 per cent. The company will also be raising subordinated debt for Tier II capital. The government and the Reserve Bank will extend subordinated loan to the tune of Rs 700 crore with GOI and RBI pumping in Rs 350 each.
Multilateral agencies like the World Bank, the Asian Development Bank, the Overseas Economic Cooperation Fund of Japan and the Commonwealth Development Corporation have committed $ 100 million to IDFC.
The board of directors constituted a committee of directors to identify the senior management for IDFC. The board has also decided to set up a multi disciplinary Task Force for the preparation of a detailed business plan. This plan is expected to be ready by May 31, 1997. IDFC has been incorporated in Chennai on January 30, with an authorised share capital of Rs 5,000 crore.