Mumbai, Apr 28: Exim Bank has recorded a 17 per cent dip in its net profit for fiscal 1999 at Rs 165 crore, down from Rs 201 crore recorded in the previous financial year. The fall in net profit was attributed to provision of Rs 75 crore towards income tax following the withdrawal of the IT exemption status in the latest union budget. The profit before tax of Exim Bank was pegged at Rs 239.99 crore in fiscal 1999. Exim Bank will pay a lower dividend of Rs 33 crore to the central government against Rs 41 crore last year.Announcing the annual financial performance in Mumbai on Wednesday, Exim Bank managing director YB Desai said that the latest budget has abolished the institution's tax exemption status. With the tax exemption gone, Exim Bank would be moving the authorities concerned for availing of the benefit of debt recovery tribunals, he said. Exim bank has net non-performing assets (NPAs) of 5.4 per cent of its industrial loans given to export-oriented units.
The institution's disbursement has fallento Rs 1,271 crore from Rs 1,370 during the year. The loan sanctions of the institution have aggregated to Rs 1,838 crore under various lending programmes during the year as against Rs 1,841 crore during 1997-98. The loan outstandings of the bank have increased by 11.48 per cent (Rs 4,264 crore) during the year. Exim Bank has set a target of Rs 2,000 crores for both sanctions and disbursements during the current fiscal.
The export contracts supported by the bank increased by 75 per cent to Rs 3,307 crore in 1998-99 and Indian companies secured 68 contracts valued at Rs 1,054 crores in multilateral funded projects overseas. Desai said Indian companies have been doing well in project exports and in 1998-99 there was a surge in services exports with 21 Indian consultants being extended financial support jointly with Washington-based international finance corporation.
Among the new initiatives, Exim Bank has decided to finance export contracts without any value restriction. Other initiativesinclude:
Rupee lines of credit for financing exports allowed;
New programme for long term working capital for export-oriented companies introduced;
New programme to provide loans for development of software products on soft terms introduced; and
Funding support for Indian consultancy assignments overseas enhanced;Exim Bank has been granted permission to participate in the equity of Indian ventures overseas. It is now in a position to provide a comprehensive financing package comprising equity and guarantees to Indian companies to set up ventures abroad. According to Desai, several countries are seeking bank's line of credit in rupees for funding imports from India. Namibia wanted only rupee credits as its currency -- the band -- has steeply depreciated in value, Desai said.
In Eastern Europe, Poland has expressed interest in rupee credits, while the bank has made offers to southeast Asian countries such as Malaysia, Thailand, Indonesia and Phillipines for a similar facility.Exim bank would offer the rupee line of credit at interest rate between 12 and 13 per cent, depending on the tenor of the credit offered as well as the country risk.
For a maturity period of one year the bank will charge an interest rate of around 12 per cent, while for a two-year maturity period the rate will be around 12.5 per cent. After providing equity finance to eight companies to set up ventures overseas last year the bank has already firmed up plans to fund two more projects during the year.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
Printer-friendly page
