SKS Microfin Raises .₹ 2,825 cr by Securitising Debt in 4th Qtr
The amount raised through selling loan receivables is 80% more than last year
Kolkata: In what appears to be a sign of revival in the moribund securitisation market, SKS Microfinance, the listed lender to the poor, has raised .₹ 2,825 crore by selling its loan receivables to investors as well as banks in the fourth quarter. This was 80% more than what the micro lender did in the year-ago quarter.
According to primary estimates by ICRA, the combined volume of securitisation and direct selling of loans is likely to grow by a third to around .₹ 59,000 crore in 2015-16, compared with .₹ 44,000 crore in the preceding fiscal.
Securitisation is a process of pooling various types of loan receivables and selling their related cash flows to third-party investors as securities. Banks with gaps in priority lending invest in pass through certificates issued by lenders with high volume of priority loans. Banks also purchase priority sector loan receivable pools directly from other lenders, which is known as direct assignment of loans.
SKS president Dilli Raj told ET that the micro lender had sold pass through certificates to raise .₹ 2,310 crore from investors while it sold receivables worth .₹ 506 crore directly to banks. In 2014-15, SKS had raised .₹ 1,559 crore by selling loans through these routes.
Bandhan Bank also sold priority sector loans worth .₹ 2,000 crore to other banks as direct assignment.
Before last fiscal, the market had seen steady decline amid low loans growth. The combined value of retail loans assigned and securitisation was aroSund .₹ 44,000 crore in 2014-15.
SKS sold pass through certificates to raise 2,310 crore from investors, and sold receivables worth 506 crore directly to banks