Centre mulls IIFCL, IFCI merger

    Centre mulls IIFCL, IFCI merger
    In order to further strengthen the infra project financing mechanism in the country, the Union government is contemplating the merger of two state-run financial institutions India Infrastructure Finance Company Ltd (IIFCL) and IFCI Ltd, as both are currently financing projects in the infrastructure sector. It is better to have one large institution which caters to the demands of the infrastructure sector, rather than two firms when both of them are primarily non-banking financial companies (NBFCs), said an industry insider, adding that discussions are still exploratory and no proposal had been firmed as yet. Sources further said claiming that though there were some informal discussions for a possible merger, the idea was not pursed as it was unviable. It is worth mentioning here that IFCI clocked a loss of Rs.318 crore for the last quarter of 201617 and likewise, IIFCL, which posted a profit of Rs.69 crore for the last quarter of the last fiscal, is under stress as its gross bad loans more than doubled to 7.7% in FY 17 as against 3.1% in FY 16, he said.
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