REC has raised $75 million (about Rs 561 crore) term loan from Sumitomo Mitsui Banking Corporation (SMBC). The proceeds from this facility shall be utilised to fund power sector projects as permitted under the external commercial borrowing (ECB) guidelines of the Reserve Bank of India (RBI).
Along with the loan, the company has also entered into interest rate swap referencing Secured Overnight Financing Rate (SOFR) to hedge the interest rate risk on this facility, which is the first such deal by any corporate in India.
REC is engaged in providing financial assistance to state electricity boards, state government departments and rural electric cooperatives for rural electrification projects as are sponsored by them.
