Chennai based non banking financial business IFMR Capital has entered into a venture with the Japanese bank Sumitomo Mitsui Banking Corporation to facilitate investments in the priority sector in India, a senior executive of the business said. IFMR Capital, that has been created in 2008, links NBFCs working with investors in present and emergent debt capital markets, among economically excluded families and companies like micro lenders, vehicle financiers and affordable housing financiers, lenders to smaller businesses, agricultural finance companies. IFMR Capital has increased date. Over Rs40, 000 crore for its customers to parties have signed a memorandum of knowledge under which the relationships of IFMR Capital would be utilized by SMBC, credit underwriting and product structuring capacity, risk management procedures in obtaining priority sector assets in the nation.
This venture is of strategic value to both organizations in promoting financial inclusion worldwide as we expand our footprint. We believe this may be a harbinger of increased attention from various other investors in the APAC region, said Kshama Fernandes, ceo and managing director of IFMR Capital. The venture can help the expertise in the fiscal inclusion room of SMBC leverage IFMR to create its priority sector book. As a bank, they will have to meet with conditions for PSL. A big part of their book is wholesale or institutional in nature, said Fernandes, including that SMBC is going to be in a position to leverage on the understanding of IFMR as well as the last mile reach in priority sectors.
IFMR gets the power to judge credit in the last mile and permit them get this credit across asset types, while it’s in the form of bonds or term loans, she included. The venture will play an integral part in developing interest from the Asia Pacific area in fiscally excluded sectors in India among Japanese as well as other investors. Now, SMBC operates through its only division in New Delhi. The Japanese bank is establish to start its second branch shortly. SMBC is engaged in venture capital, securities, charge card, investment, mortgage securitization, leasing as well as other credit related companies.
The Sumitomo Mitsui Financial Group is one among Japan’s biggest banks with total assets of around $1.8 trillion, employing 30, 000 individuals in 500 plus divisions across the world. IFMR Capital, in latest months, has increased capital obligations of $75 million from private equity shareholders. In December, it introduced that Standard Chartered Private Equity has made an investment of $17 million and will raise it more to total $50 million. Previously from Eight Roads Enterprises, the firm had raised $25 million in November, the proprietary investment arm of Fidelity International Ltd.