Indian mortgage lender Housing Development Finance Corporation (HDFC) is set to upsize foreign loans to $1bn from $750m, the Economic Times reported citing sources.
The move will see HDFC become the first borrower in the country to benefit from the Reserve Bank of India’s increased external commercial borrowing (ECB) limit under the automatic route.
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HDFC plans to use the proceeds to offer loans to customers looking to buy low-cost affordable homes.
The matter is being discussed between HDFC and the lenders and the deal is closing now, an executive told the publication.
According to the sources, the government-backed State Bank of India (SBI) will also join the syndication process, which will be joined by MUFG, Mizuho Bank and Standard Charted Bank.
The central bank’s decision to raise the limit of ECB to $1.5bn from $750m is part of its efforts to shore up its depleting forex reserves.
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By GlobalDataIn a separate development last week, HDFC announced that it has received green light from the Pension Fund Regulatory and Development Authority (PFRDA) for its merger with HDFC Bank.
“We wish to inform you that HDFC Limited has today i.e. on July 8, 2022, received an approval from PFRDA regarding change in its status/ constitution pursuant to the Scheme in accordance with the PFRDA (Point of Presence) Regulations, 2018, subject to a condition that the services to NPS subscribers associated with HDFC Limited will not be affected due to the Scheme,” the non-bank lender said in a filing.
Earlier that week, the RBI approved the merger plan subject to certain conditions, which were not disclosed.
The deal, which was announced in April this year and will create a INR13 trillion banking behemoth, is still subject to approval from various authorities.
