MICROCAPITAL BRIEF: Wholesale Lenders Agree to Restructure Debt of Indian Microfinance Institution (MFI) Spandana Sphoorty Financial Limited

A group of lenders, led by Indian commercial bank ICICI Bank, has approved a debt restructuring plan for Spandana Sphoorty Financial Limited, an Indian microfinance institution (MFI). The agreement paves the way for Spandana to refinance its debt at a 12-percent annual interest rate and extend the tenure of the wholesale loans from three years to six years. Spandana's promoters will inject new funds into the MFI, while the banks will provide additional credit, allowing Spandana to resume lending to its microcredit clients [1]. Spandana reportedly has total debt of INR 3,325 crores (USD 743 million), of which approximately INR 2,000 crores (USD 447 million) will be restructured through this agreement. Of 35 creditors involved in the agreement, two major banks account for almost 30 percent of the.... Continue reading here. Contact MicroCapital to receive a complete sample issue of the MicroCapital Monitor, the monthly microfinance newspaper.