Fm Pushes For Lower Idbi Bond Rates

Though there will be no financial assistance for Industrial Development Bank of India (IDBI) from the government, the finance ministry today tried to impress upon banks and insurance companies to agree for a reduction in interest rate on bonds issued by IDBI.

While the amounts involved for individual banks and insurers could not be ascertained, institutional sources estimate the total amount to be in excess of Rs 6,000 crore.

The matter was discussed at a meeting convened by finance secretary S Narayan here today and was attended by banking and insurance secretary D C Gupta, State Bank of India chairman Janaki Ballabh, Punjab National Bank chief S S Kohli, Bank of Baroda chairman and managing director P S Shenoy, Life Insurance Corporation chairman S B Mathur and a General Insurance Corporation representative.

 

Institutional sources said some of the bonds issued by IDBI carry coupon rates as high as 16-16.5 per cent and with interest rate softening in the last one year, India