Federal Bank ties up with JCB India to finance heavy equipment buyers

Federal Bank on Friday said that it has tied up with JCB India to finance the prospective buyers of heavy construction equipment and boost its loan portfolio.

The private sector lender said it has inked a memorandum of understanding (MOU) with JCB India, a leading manufacturer of earthmoving and construction equipment.

The arrangement will boost financing options for JCB customers in India, said Federal Bank in a release.

Under the arrangement, Federal Bank will be the preferred finance partner of the construction equipment manufacturer, where JCB's customers can avail loans from the lender at competitive interest rates.

With the government's focus on infrastructure development continuing to remain strong, there will be various opportunities to create synergies between the teams from JCB India and Federal Bank, Deepak Shetty, CEO and Managing Director of JCB India, said.

"Importantly, it will give greater financing options to our customers while purchasing JCB machines both in urban and rural India," he added.

Shyam Srinivasan, Managing Director and CEO of Federal Bank, said the lender has officially become the financing partner for JCB India.

"This partnership would prove to be hugely beneficial to a segment of customers who are looking for easy finance options to take their business forward. We are confident this association will help remove barriers between Bharat and Atmanirbhar Bharat," he added.

Federal Bank reported an about 53% rise in its standalone net profit for the second quarter ended September 2022 or Q2 FY23 to ₹703.7 crore as compared to ₹460.3 crore from the year-ago quarter.

The lender's net income interest (NII), which is the difference between the interest earned and expended, rose about 19% to ₹1,762 crore from ₹1,479.4 crore year-on-year (YoY). On the other hand, its net interest margin (NIM) improved to 3.30%, higher by 10 bps YoY and 8 bps QoQ.