New ECB norms limit refinancing options: Fitch

The recent Reserve Bank guidelines simplifying external commercial borrowings will “curb” refinancing options for companies, says a report. But the system-wide impact of this will be limited, as there were masala bonds and foreign currency debt issuances recently with a minimum average maturity of 10 years, global rating agency Fitch said.

The report said the RBI’s intention behind the new rules is to rationalise multiple regulations and make it easier for corporates to borrow from overseas markets. Eligible borrowers will now be allowed to raise up to USD 750 million per financial year without approval, with previous sector limits removed, as per the notification issued recently.