Speaking to The Financial Express, IFCI chairman and managing director PV Narasimham said that the institution has decided to have a "medium-sized public bond issue" this year. "The institution had avoided a public bond issue during last four years ...and preferred to rely on private placements to meet its fund requirement," he said.

At present the institution has enough liquidity and would wait for some time for the stability in the interest rate, he said. IFCI is also planning to have a rights issue on par in June.

According Narasimham, the institution--beset with the problem of high non-performing assets--is preparing a blueprint for business growth. "My approach to institution's problem of non-performing asset is different,'' he said.

Stating that with proper financial assistance and a timeframe of five years, a lot of companies can berevived and their accumulated losses can be wiped out, Narasimham said, "I do not think it is appropriate to rush to conclusion and declare a company sick." He emphasised the need for a pro-active approach for the weak companies.

As a risk-mitigating factor, the IFCI chief favoured selective exposure in new projects after taking their sizes and technology into consideration.

Admitting that lack of proper information about the companies has been a major handicap in determining status of the company, he said that the financial institutions are in talks with the Reserve Bank of India to expand the scope of seeking more accurate information from corporates.

As a business strategy, IFCI is re-evaluating its exposure to the major sectors, he said. After deciding against any further funds to the steel sector, the institution is planning to prune its exposure in other sectors where it has reached its optimum level.

Both Industrial Development Bank of India as well as ICICI Ltd are however ready to pump inmore funds into the beleaguered steel sector.

According to Narasimham, the credit expansion is possible in the system provided the cases weak companies are properly examined for additional funding.