ACTIVITIES OF COSIDICI

1. Meeting of CEOs of SIDCs with C.M.D., National Housing Bank :

As the apex body of State Level Financial Institutions (SLFIs), COSIDICI has been examining the prospect of diversifying the business portfolio of these Institutions to enable them to compete with other financial intermediaries so as to survive the onslaught of liberalisation and financial sector reforms. After a great deal of deliberations COSIDICI suggested the following two proposals for consideration by SLFIs :- 
  • SIDCs may set up Housing Finance Subsidiary to provide housing loans to individuals, institutions and government employees in their respective states.
  • Undertake marketing of Insurance products of Life and General Insurance Companies as Corporate Agents.
At the initiative of COSIDICI a meeting of Chief Executives of SIDCs with Shri P.P. Vora, C.M.D., National Housing Bank was held on April 24, 2001 at New Delhi in the offices of National Housing Bank to discuss the prospect of Housing Finance business in states, viability of setting up housing finance subsidiary and the support available from NHB. The details regarding the discussions at the meeting are given in the article on "SIDCs to Diversify into Housing Finance" in this Issue by Shri K.K. Mudgil, Secretary General, COSIDICI.  

2. Training : 

In today's scenario of liberalisation and economic reforms, it is imperative to impart need based training to the officers of SLFIs on an ongoing basis to apprise them of the latest financial techniques and improve upon their interpersonal skills etc. COSIDICI has been making concerted efforts in this regard for the past two years. One such programme on `Project Finance and Monitoring' was organised in NIBSTC, New Delhi in May 1999. Efforts were also made to have institutional arrangements with IDBI to provide training at their Hyderabad Institute. However, the high cost of training at the Institute, which our Members could ill afford, discouraged them to depute their officers for it. Secretary General, COSIDICI has now held detailed discussions with three more Institutes and has found the quality and infrastructrue facilities available with College of Agricultural Banking, RBI, Pune to be good, the faculty experienced and the cost reasonable. The principal of the College has agreed to structure need based training programmes for the officers of SLFIs. Details are expected to be finalised soon and will be given in the next issue of the COSIDICI COURIER. 

3. Appointment of Statutory Auditors of SFCs :

The Amended SFCs Act, 2000 vide the amended provision of Section 37 of the Act had empowered the shareholders of the Corporation to appoint the statutory auditors out of the panel of auditors approved by RBI on such terms and remuneration as the RBI may fix. The matter had been taken up by COSIDICI with RBI and the latter had immediately conveyed the names of audit firms to be appointed by the SFCs as statutory auditors for the year 2000-01. As most of these audit firms were from centres other than the place where the SFCs were functioning, the corporations were reluctant to appoint them as their statutory auditors due to the heavy expenditure expected to be incurred on their travel and accommodation. It was also felt that frequent interaction would also not be possible due to the distance in location. COSIDICI had taken up the matter again with RBI and they had advised that as the information relating to financial data of SFCs was not readily available the names of audit firms were recommended to each Corporation out of the panel of the Statutory central auditors on the basis of their seniority. The SFCs were, however, not reconciled to the situation. Secretary General, COSIDICI had, therefore, written to RBI again and stressed on the need to provide a panel of auditors to SFCs - it being a mandatory provision of section 37(1) of the SFCs Act, as amended by SFCs (Amendment) Act, 2000. Results are awaited.