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Public sector banks warming up to finance COVID-19 healthcare infrastructure

Public sector banks (PSBs) in India seem to be warming up to actively financing COVID-19 related healthcare infrastructure and associated segments, finally joining the government and central bank’s efforts to boost liquidity in the sector.

This comes after the Reserve Bank of India (RBI) in May announced fresh Rs 50,000 term liquidity facility for a “wide range of entities” in the COVID-related healthcare infra and services space, with the amounts having exceeded Rs 500 crore each, Hindu BusinessLine reported.

Here’s what some banks have done:
– Canara Bank: MD & CEO LV Prabhakar said they are “doing homework” on financing medical services under the COVID loan book and have already sanctioned over Rs 1,200 crore worth loans till “a few weeks” back. He added that the bank could “comfortably disburse and sanction” Rs 4,000-4,500 crore more under the portfolio.

– Indian Bank: CEO Padmaja Chunduru told the paper Indian Bank has identified many of its own existing customers to lend and fixed a target of Rs 4,000 crore for its ‘COVID loan book’ portfolio. She added that over Rs 600 crore was already sanctioned under this till the last two weeks back, stating that “there is good traction and lot of enthusiasm” for the business.

– State Bank of India (SBI): India’s largest PSB said its COVID loan book could expand to around Rs 10,000 crore worth as it is “keen on supporting hospitals and nursing homes augmenting their oxygen facilities and other requirements”.

– Union Bank of India: MD & CEO G Rajkiran Rai said they are “positive about building a COVID loan book”, adding that their branches are “canvassing and reaching out to potential borrowers”.

Fresh loans under the RBI facility will be classified as ‘priority sector lending’ till time of repayment or maturity of the loans.

The banking sector is among the few that has seen the pandemic give its “new opportunities” especially in healthcare over the short and medium term, even while many others grapple with slowdown.

In fact, the healthcare infrastructure sector has become so lucrative, private lenders are also “actively” seeking lending opportunities, the report added. Moneycontrol

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