SBI sets up central project finance cell

State Bank of India would speed up project financing and sanction of loan proposals through its newly set-up central processing cell (CPC) at its corporate office in Mumbai where projects larger than Rs 2 crore would directly be taken up for consideration and decided in a month.

"As of now although the written rule is to decided to on a loan proposal greater than Rs 2 crore in 30 days, in actuality the total number of days taken is much more. Hence, we have set up the Central Processing Cell that will decide on a loan proposal within exactly 30 days," explained A K Purwar, chairman, State Bank of India.

Purwar was talking to newspersons at the sideline of an interactive session organised by the Bharat Chamber of Commerce with him on Saturday in Kolkata.

Sources from the bank said that project proposals as of now passes through a number of levels that delays the whole process, requiring more than a month to decide on any single proposal.

The CPC was set up with the idea of doing away with the multi-level approach on sanctions of loan proposals to speedup up the process.

"From now on the CPC will decide whether to grant a loan or not strictly within this period," Purwar added.

SBI has targeted a 15.5 per cent growth in advances this year of which a major portion would be on project financing and corporate lending.

Purwar also mentioned that SBI along with other banks had managed financial closure of ten new mega power project involving a few thousand crore.

Meanwhile, SBI has also decided to grant the tea industry in West Bengal a breather in terms of conversion of existing working capital funding to long-term loan, and grant further working capital as per the decision of the Indian Banks' Association.

Although the bank had in principally decided to offer the packages as laid down by the IBA, to tea companies, the industry has been complaining non-availability of such package from SBI.

Purwar said SBI would declare the package from May 31, and would direct officers concerned to make available the package.