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PFC to complete REC takeover this fiscal; posts 53% rise in Q3 profit

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New Delhi: State-run Power Finance Corp on Monday said it will complete acquisition of Rural Electrification Corp within this fiscal. The company said it will not be required to make additional provisioning for bad loans.

It posted a 53% rise in net profit to Rs 2076 crore during the third quarter (October-December) of the current financial year from Rs 1,355 crore in the second quarter .

“On the loan asset front, PFC has registered a loan asset growth of 14% from the corresponding period in previous financial year. Similarly, disbursements saw an increase of 20%. Also, in terms of stressed assets, the worst is behind us and we do not see any additional provisioning going forward,” a company statement said.

The Net interest income rose by 12% to reach a figure of Rs 2,435 crore as against Rs 2,180 crore recorded during the second quarter of the current financial year. PFC’s net interest margin was 3.42% for third quarter. Its capital adequacy ratio (improved by more than 1% to about 18.95% from previous quarter, the statement said.

The cabinet committee on economic affairs on December 6, 2018 gave it’s in-principle approval for sale of government’s existing 52.63% equity shareholding in REC Ltd to PFC along with transfer of management control. The endeavor is to conclude the acquisition deal by March 31, 2019, the statement said.

Source: Economic Times