NEW DELHI : Power Finance Corp. Ltd (PFC), the largest power sector lender in India, is interested in acquiring Yes Bank Ltd’s green energy loans if they turn out to be good assets, PFC chairman and managing director Rajeev Sharma said.
Yes Bank, which was placed under moratorium by the Reserve Bank of India on Thursday night, has an exposure of about ₹12,000 crore to clean energy companies, making it one of the largest lenders to the sector, according to Mint research.
“If they are good performing assets and if it fits into our evaluation criteria and we find them viable, we will be interested," Sharma said.
State-run PFC’s purchase of a controlling stake in state-run peer REC Ltd in March created an $80 billion lending giant by assets. PFC and REC have reported assets of $43 billion and $37 billion, respectively.
Many potential investors have approached State Bank of India (SBI), which is expected to buy 49% in Yes Bank as part of a bailout plan, after seeing the draft scheme, according to SBI chairman Rajnish Kumar.
“No one has approached us yet," Sharma said.
Yes Bank’s collapse comes at a tough time for India’s clean energy sector, with mounting dues to generators and banks wary of lending to renewable energy developers as they suspect the viability of such projects over record low solar and wind power tariffs.
India’s renewable energy programme will require $80 billion in investments till 2022. This figure will grow more than threefold to $300 billion during 2023-30.
The government, however, remains confident about India’s renewable energy sector. “Yes Bank is not the only bank that is lending to the renewable energy sector. None of our projects have become NPAs (non-performing assets). India’s renewable energy sector is resilient enough to get investments from other banks and financial institutions," Anand Kumar, secretary in the ministry of new and renewable energy.
India is running what will become the world’s largest clean energy programme, with an aim of having 175GW of clean energy capacity by 2022. It plans to add 100GW of solar capacity by 2022.
India’s power sector is also going through a tough phase, with NPAs in power generation accounting for a major chunk of the banking sector’s stressed assets of around ₹4.1 trillion.
