Ernakulam District Co-op Bank offers Rs.450 Crore loan to Kochi Metro

एर्नाकुलम Ernakulam (ERS): Nearly 10 days after the state government agreed to repay a loan of Rs.470 crore required by Kochi Metro Rail Ltd (KMRL) to speed up the project work, banks are queuing up before the Metro agency to loan the amount.

The Ernakulam District Co-operative Bank (EDCB) is the first to disclose having held talks with KMRL in this regard. The bank has offered the entire amount of Rs 470 crore needed by the Metro agency.

“We are ready to provide the loan for 10% interest. The repayment period will be 12 years. The loan will be provided on the basis of the guarantee given by the state government and KMRL. We will look into the possibilities of getting other collateral security,” said bank president N P Poulose. KMRL would end up paying Rs 1,034 crore at the end of the term if calculated at 10% simple interest.

EDCB held discussions with chief minister Oommen Chandy and minister in-charge of railways Aryadan Mohammed on Wednesday. “We have submitted a memorandum to the ministers. On Thursday, we held discussions with KMRL managing director Elias George. The responses from all quarters are positive,” added Poulose.

At a review meeting, convened by Oommen Chandy at Thiruvananthapuram on January 6, it was announced that the government would avail the loan on the annuity basis in which repayments are made at fixed intervals. The repayment period was also fixed at 10 years.

The amount will be mainly utilized to acquire land for widening the Vytilla-Pettah road, thus clearing a major hurdle in implementing the Metro project. The bank loan is also expected to facilitate land acquisition and road widening works between Aluva and Maharaja’s College ground.

Meanwhile, KMRL MD Elias George said the Metro agency has also asked for quotations from other interested banks and financial institutions. “We are basically looking at the interest rate. The matter will be taken up at the KMRL director boarf meeting scheduled for Tuesday. A final decision regarding the loan will be announced next week,” he said.