In a bid to enter banking sector the government-run Power Finance Corporation (PFC) has now decided to acquire a 'substantial' stake in a public sector bank. It has already written to the ministries of finance and power and is waiting for their nod. Like its peers ICICI, IDBI and HDFC, PFC also intends to enter the banking sector.
Power Finance Corporation Chairman Satnam Singh said that the State-firm will zero in on banks for negotiations once it gets approval from the ministries concerned. It would like to acquire stake that can get it position on the board of the bank, said Power Finance Corporation Chairman Satnam Singh.
He said RBI has already approved the corporation's joint venture with Tata Capital to venture into private equity fund for power sector. The JV will launch fund with $ 300 million, which will be increased to $1 billion in future.
Amidst concerns over poor financial health of distribution companies and struggling power projects, Power Finance Corporation reported reduction in gross nonperforming assets to 0.71 per cent on March 31, 2013 from 1.04 per cent as at March 31, 2012.
Its net profit went up by 46 per cent to Rs 4,420 crore for the year ended March 2013 as against Rs 3,032 in the 2011-12. The corporation's total income rose by 32 per cent to Rs 17,273 crore in 2012-13 as compared to Rs 13,037 crore.