KOCHI: The Canara Bank on Sunday expressed its willingness to fund the monorail projects in Thiruvanathapuram and Kozhikode. After signing a loan agreement with the Kochi Metro Rail Limited (KMRL) here, Canara bank chairman and Managing Director R K Dubey told reporters that funding will not be an issue for the state when it comes to implementing development projects.
The loan agreement with Canara Bank for Rs 1,170 crore was inked at a function organised at the KMRL office here in the presence of Dubey, KMRL MD Elias George and Minister for Power Aryadan Mohammed.
The loan amount is for a tenure of 19.5 years. Presently the interest will be 10.8 per cent. This is one of the largest single bank loans to any metro project in India.
“After the first AFD mission in April 2013, KMRL found a gap of around Rs1,000 crore in the sanctioned term loan component of Rs2,170 crore for the Kochi Metro Rail Project.
KMRL then approached various funding agencies, domestic banks and financial institutions for a term loan of Rs1,170 crore. Though we got sanctions from almost all the banks we approached, in terms of interest, tenure, cost and charges , the Canara Bank emerged to be the best,” Elias George said.
He said that since the Banks have relaxed norms, KMRL is considering the possibilities of availing more financial support from them for the Phase 1 extension to Tripunithura and the property development planned at Kakkanad. “The KMRL board will take a final decision in this regard,” he said. More: P2
KMRL MD Elias George said the company had applied for the loan on June, 2013. After several negotiations, the bank made several relaxations like waiver of commitment charges and prepayment premium which enabled KMRL to save substantial costs. “The agreement was tailor-made for KMRL with many deviations from the banks standard format,” he said.
The total project cost for the first phase of Thiruvanathapuram Monorail project is `3,590 crore, while that for the Kozhikode project is Rs1,991 crore. The Canara Bank had earlier offered loan for the Rs1,892 crore Kannur Airport project.