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Mar 06, 2013
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Rating-linked loans to debut in India with Tata Steel’s Rs 22800 crore loan
Rating-linked lending — loans where the cost of borrowing rises after every downgrade — are about to debut in India. One of the biggest names in Corporate India, Tata Steel, has agreed to lenders' condition to pay a higher interest rate for a proposed Rs 22,800-crore loan if its credit rating slips. "This is the biggest long-term loan deal to be signed in recent times... more importantly, it will be a floating rate loan-linked to the company's credit rating," said a banker who has sanctioned the loan to the Tata Group company.
Source -
http://economictimes.indiatimes.com
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