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Section 25 – The State Financial Corporation Act,1951

<h2The State Financial Corporation Act,1951

Section 25. Business which Financial Corporations may transact

(1) The Financial Corporation may, subject to the provisions of this Act carry on and transaction any of the following kinds of business namely:–

(a) The guaranteeing on such terms and conditions as may be agreed upon of loans raised by industrial concerns which are repayable within period not exceeding twenty years and are floated in the public market;

(b) The underwriting of the issue of stocks, shares, bonds, or debentures by industrial concerns;

(c) The receipt in consideration of the services mentioned in clauses (a) and (b) of such commission as may be agreed upon:

(d) The retention as part of its assets of any stocks, shares, bonds, or debentures which it may have to take up in fulfilment of its underwriting liabilities; provided that it disposes of the stocks, shares, bonds or debentures so acquired as early as practicable and in any case within the period of seven years from the date of such acquisition;

(e) The granting of loans or advances to, or the subscribing to debentures of, industrial concerns, repayable within a period not exceeding twenty years from the date on which they are granted or subscribed to, as the case may be; and

(f) Generally, the doing of all such acts and things as may be incidental to or consequential upon the exercise of its powers or the discharge of its duties under this Act.

(2) No accommodation shall be given under clauses (a) and (e) of sub-section (1), unless it is sufficiently secured by a pledge, mortgage, hypothecation or assignment of Government or other securities, stocks, shares or secured debentures, bullion, movable or immovable property or other tangible assets in the manner prescribed by regulations.

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The State Financial Corporation Act,1951

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