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The lender with about Rs 17000 crore assets under management has borrowed the fund at a coupon which is benchmarked with Secured Overnight Financing Rate (SOFR). The blended cost of it was 7.9%, which is 160 basis points over SOFR, a senior company official said.
The non-banking finance company has secured this funding through a social loan facility. DBS Bank and SMBC have invested $50 million each in the loan syndication. The tenure of the loan is three years.
The ECB will help the lender diversify its resources. This is the first external borrowing by the company after it was taken over by Warburg Pincus.
“This ECB facility shows the trust that marquee investors have in our business model,” Truhome Finance managing director Ravi Subramanian
The global private equity firm bought the non-banking finance company from Shriram Capital and San Francisco-based PE Valiant Capital Management for Rs 4,630 crore in December last year. Warburg invested another Rs 1,200 crore into the company last year itself and has committed to infuse more capital whenever needed.The company has a network of 165 branches across 17 states and union territories. Major industrial states such as Gujarat, Maharashtra and Tamil Nadu accounted for 18%, 18% and 16% of the AUM respectively, at the end of December.The company focuses on borrowers from the middle-income group and low-income groups, mostly residing in urban and semi-urban regions, and has an average loan book ticket size of Rs 18 lakh, which is significantly higher than its peers in the affordable housing finance space. India Ratings & Research said in its rating report last month.
About three-fourth of Truhome’s borrowers are self-employed and operating in a formal sector.
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