Loan syndication by banks for Indian firms in the domestic and overseas market has already reached a total of $38.5 billion (Rs 1,77,110 crore) through 108 deals in 2009 so far--a 17 per cent growth over the comparable period last year, according to a report by global deal tracking firm Dealogic. This figure eclipses the previous high of $38.1 billion achieved in 2007.
For the first time, Indian loans syndications were the largest in Asia-Pacific excluding Japan and made up 23 per cent of the region’s volumes.
By far the infrastructure sector was the largest recipient of arranged loans with project finance accounting for 78 per cent of the total volume.
| THE TALLY Indian syndicated loan volume ($m) | |||
| Credit Date | YTD | Rest of year | Total |
| 2002 | 1,581 | 460 | 2,041 |
| 2003 | 2,740 | 1,136 | 3,876 |
| 2004 | 4,756 | 1,187 | 5,943 |
| 2005 | 10,847 | 1,418 | 12,265 |
| 2006 | 22,189 | 3,564 | 25,752 |
| 2007 | 33,580 | 4,468 | 38,048 |
| 2008 | 32,907 | 4,505 | 37,412 |
| 2009 YTD | 38,509 | 0 | 38,509 |
| Source: Dealogic | |||
A total of $30.2 billion has been raised through 62 deals for project finance purposes in 2009 so far--more than three times the $9.7 billion raised in the corresponding period last year.
Syndicated loans are large financing facilities granted to a borrower by a group of financial institutions who share the lending risk between them. They combine the commercial financing relationship between a bank and its client with the features of market traded debt.
Volume from Indian companies has surpassed Australia, where syndicated loan volume amounted to $36.5 billion and has become the leading nation in Asia, Dealogic said, adding that Indian companies raised money mainly to fund their upcoming as well as current projects.
SBI Capital Markets is currently leading the India mandated arranger ranking in 2009 with a deal share of 64 per cent, while international banks such as Deutsche Bank and Citi rank fourth and fifth in the table with shares of 1.6 per cent and 1.2 per cent, respectively.
