SBI Says Never Agreed to Fund Adani's Australian Coal Project

Published: 09th December 2015 12:06 AM  |   Last Updated: 09th December 2015 12:06 AM   |  A+A-


MUMBAI: State Bank of India today said it had not committed to extend any loan to the Australian coal mines project of Adani Group but had only signed a memorandum of understanding for the same provided the company met all its eligibility criteria.

"We would like to state that State Bank of India had never committed any loan to the Adani Group. We had only signed an MoU with the group in Australia last year, for assessing the Carmichael coal mines project," SBI said in statement.

"Signing an MoU is the preliminary step after receiving the loan application, after which the bank starts its due diligence process. It does not mean approval or sanction of the loan, which happens after successful completion of the due diligence process and the company meeting the eligibility criterion," it further said.

The bank also denied that the MoU was signed in the presence of Prime Minister Narendra Modi.

Earlier, it was reported that SBI had gone back on its commitment to extend USD 1 billion to the company for funding the USD 15-billion Carmichael coal mine project which also includes building a railhead to and a port at Abbott Point.

Though the Adanis bought the coal mines, which has the world's largest coal reserves, in 2010, the project has not taken off due to severe opposition from green activists.

Group chairman Gautam Adani had said that recently he requested the Australian prime minister to pass a new law that prohibits green activists from approaching courts to review government sanctions time and again and this has also forced banks from funding the project.

"SBI follows strict procedures and guidelines for approving loans for all our customers. We have in the past clarified our position in this particular matter on many occasions in the media and other public platforms.

"We would like to emphasise that our bank, being a professionally run outfit believes in maintaining the highest standards of transparency, integrity and commitment towards all stakeholders," the SBI statement added.


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