Satin Creditcare Network Board Approves Credit Enhancement For Its Housing Finance Arm
Its board has approved increasing the limit "for issuance of Letter of Comfort up to an amount not exceeding Rs 300 crore from existing limit of Rs 200 crore".
Satin Creditcare Network Ltd. announced on Wednesday that its board had approved a credit enhancement for its wholly owned subsidiary, Satin Housing Finance Ltd.
The company's board had, in a meeting held on Wednesday, "considered and approved the enhancement of the limit for the issuance of a letter of comfort, or side letter, or any other letter by whatever name called, up to an amount not exceeding Rs 300 crore from the existing limit of Rs 200 crore," according to the company's exchange filing.
The move will make it easier for Satin Housing Finance to borrow money by offering the Letter of Comfort to potential lenders. The amount is an increase from the earlier amount of Rs 200 crore but has been capped at Rs 300 crore.
At the same time, the filing has clarified that "this will not be a guarantee on the part of the company to make payment on behalf of the subsidiary in case of default.".
The non-banking finance company's disclosure added that its nature of interest in the transaction entails "common directorship in both the entities.". However, it added that the transaction will be done on an arm’s-length basis.
In February, Satin Creditcare Network had reported that it has been assigned an SQS2 Sustainability Quality Score (very good) for its Social Financing Framework dated January 2025.
Moody’s Ratings, as a second-party opinion, has evaluated and assigned this rating, recognising SCNL’s strong alignment with international sustainability standards, the company's filing had stated at that time.
Shares of Satin Creditcare Network Ltd. closed 0.86% lower at Rs 143.35 apiece on the BSE, compared to a 0.10% decline in the benchmark Sensex.
