INDUSTRIAL INVESTMENT BANK OF INDIA
The Industrial Reconstruction Corporation of India Ltd. was set up in 1971 as a primary agency for rehabilitation of sick industrial units. It was renamed as the Industrial Reconstruction Bank of India (IRE!) by an Act of Parliament with effect from March 20, 1985.
IRBI functions as the principal credit and reconstruction agency for industrial revival by undertaking, modernization, expansion, reorganization, diversification or rationalization of industry and also coordinates similar work of other institutions engaged therein and to assist and rehabilitate industrial cancers.
In March 1997, the Industrial Reconstruction Bank of India itself was ie-named as Industrial In¬vestment Bank of India and converted into a limited company to provide it operational flexibility to become self-reliant. The Industrial Investment Bank has thus become a full-fledged development financial institu¬tion. It will, however, continue its traditional role of nursing ailing industrial units.
The lIBI is empowered
(i) to grant loans and ad¬vances to industrial concerns,
(ii) to underwrite stocks, shares, bonds and deben¬tures,
(iii) to guarantee loans/deferred payments and per¬formance obligations of any contracts undertaken by industrial concerns, and
(iv) to act as an agent of Central and State Gov¬ernments, Reserve Bank, State Bank, Scheduled Com¬mercial and State Cooperative banks, public financial institutions, SFCs, etc.
Its functions also-include development activities such as providing infrastructural facilities, raw ma¬terials, consultancy, managerial and merchant bank¬ing services for reconstruction and development of in¬dustrial concerns and providing machinery and other equipment on lease or hire-purchase basis.
The lIBI is empowered to take over management or possession or both and can transfer by way of lease and sale the property of defaulting industrial concerns. It can prepare schemes for reconstruction by scaling down the liabilities to submit the schemes of merger or amalgamation for approval of the Central Government. The Bank borrows funds from the Government and also by way of issuing bonds and debentures.
