RBI issues guidelines on project financing by Regulated Entities
These Directions are issued to provide a harmonised prudential framework for financing of projects in Infrastructure, Non-Infrastructure and Commercial Real Estate sectors by regulated entities (REs).
According to the circular, these Directions lay down revised regulatory dispensations for changes in the date of commencement of commercial operations (DCCO) of such projects in the backdrop of a review of the extant instructions and analysis of the risks inherent in such financing.
These Directions are issued to provide a harmonized prudential framework for financing projects in the Infrastructure, Non-Infrastructure, and Commercial Real Estate sectors by regulated entities (REs).
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In projects financed under consortium arrangements, where the aggregate exposure of the participant lenders to the project is up to Rs 1,500 crores, no individual lender shall have an exposure that is less than 10% of the aggregate exposure. For projects where the aggregate exposure of lenders is more than Rs 1,500 crores, this individual exposure floor shall be 5% or Rs 150 crores, whichever is higher.
Read Also : PFC organised a mass mobilisation campaignIn respect of infrastructure projects under the PPP model awarded by a Statutory Authority, the DCCO documented in the financial closure document may be modified to reflect any change in the ‘Appointed Date’ by the Concession Authority before disbursement of funds by way of a supplementary agreement between the lender/s and the sponsor subject to reassessment of project viability and obtention of sanction from appropriate authorities.
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