Amid controversy over sanctioning $1 billion loan to Adani group, SBI said it has only signed a preliminary MoU and will disburse the money only after proper due diligence. SBI had on the sidelines of Prime Minister Narendra Modi's visit to Australia, signed a pact sanctioning $1 billion loan to Adani group's coal project in that country.
"We clarify that this is a memorandum of understanding. This is not a loan sanction that we have given. It will go through proper due diligence both on the credit side as well as on the viability side," SBI chairperson Arundhati Bhattacharya said.
"The board will take a call and then only loan will be given," she said. "We have checked to see that there is no environmental issue and the cost of coal. The cost is also currently around USD 42 FOB which is much better than the current prices in the international market," she said.
Asked about the exposure of SBI if its board approves the loan, Bhattacharya said the net exposure would be to the tune of $200 million as there are some repayments also from the company.