PFS to get Rs 250 cr from LIC under partial credit enhancement

PTC India Financial Services (PFS) on Monday said it will raise up to Rs 250 crore from Life Insurance Corporation (LIC) under partial credit enhancement.

LIC has agreed to participate in up to Rs 250 crore in its first tranche of bonds of Rs 580 crore which would be backed by partial credit enhancement (PCE) of State Bank of India (SBI) to the extent of 20 per cent of initial issued bond amount, PFS said in a release.

In November 2018, the RBI, with a view to provide liquidity support to non-banking financial companies (NBFCs), allowed banks to provide PCE facility to NBFCs to support their bond issuances.

PFS became the first NBFC in the country to avail such facility from SBI to the extent of Rs 400 crore to support its bond issuance of up to Rs 2,000 crore, it said.

The first tranche of PFS proposed bond of Rs 580 crore, with structured repayment in 10 year and backed by SBI PCE to the extent of 20 per cent of bond issuance amount, has been rated as AA+ (stable outlook) by CRISIL, it said further.