Haryana Government inks ‘MoU’ with SIDBI for HFC

Haryana Government inks ‘MoU’ with SIDBI for HFCHaryana Government has notified that it has signed a Memorandum of Understanding with Small Industries Development Bank of India (SIDBI) to revitalize, recapitalize and restructure the Haryana Financial Corporation (HFC), so as to improve its profit ability and viability.

As a result of this MoU, the State Government has agreed to provide resources to HFC, from time to time to strengthen its equity base and provide State Government guarantee to enable the Corporation to raise market borrowings including Statutory Liquidity Ratio (SLR) bonds.

However, SIDBI would provide refinance and training programmes for project appraisal, risk management and management of Non-Performing Assets (NPA) for the benefit of the officers of the Corporation.

In addition, the HFC would also be required to improve its recovery in respect of standard assets which would not be less than 90% and bring down the NPAs to 10%. Further, the Corporation will also be required to take administrative measures to bring down the expenditure to optimum level, rationalize the staff strength and ensure timely repayments of dues to SIDBI for refinance and line of credit.

According to an official release, the latest signed MoU would be valid for a period of 5 years or till the Corporation is fully restructured or recapitalized, whichever is later.