Live
- ‘Nation First’ key to India’s progress: Prez
- Who will be next Maha CM? Rift in Mahayuti, MVA
- Nutritional value of ration rice explained
- Stage set for counting in Maha, Jharkhand
- MyVoice: Views of our readers 23rd November 2024
- Civic chief expresses ire over poor sanitation
- Deep State behind Adani crisis?
- Collector inspects GGH; asks staff to provide better medicare to poor
- Zero Case: A Saga of Eradication of Polio in India
- Cancel PPAs with Adani companies, demands CPI
RBI fast-tracks DHFL resolution
After superseding the board of the crippled mortgage lender DHFL, the Reserve Bank on Friday constituted a three-member panel to advise its administrator to help recover nearly Rs 84,000 crore that the troubled company owes to the system.
Mumbai: After superseding the board of the crippled mortgage lender DHFL, the Reserve Bank on Friday constituted a three-member panel to advise its administrator to help recover nearly Rs 84,000 crore that the troubled company owes to the system.
The panel constitutes a veteran banker, the head of a leading insurer and representation from a lobby grouping of asset managers.
The RBI had on Wednesday used recent changes in the laws to supersede the board of DHFL, announced to resolve the issue under the provisions of the bankruptcy code and appointed R Subramaniakumar as the administrator.
Subramaniakumar, the ex-MD of the State-run Indian Overseas Bank, will be helped by the advisory committee consisting of IDFC First Bank non-executive Chairman Rajiv Lall, ICICI Prudential Life Insurance Chief Executive NS Kannan and the mutual funds body Amfi Chief Executive NS Venkatesh, an official statement from the central bank said. The panel will be assisting the administrator in "discharge of his duties", it added.
The Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 provide for appointing such a panel to advise the administrator "in the operations of the financial service provider during the corporate insolvency resolution process", it said.
The city-headquartered pureplay mortgage lender is the first NBFC/HFC to go for bankruptcy resolution.
Last Friday, the government had notified Section 227 of the IBC empowering RBI to refer financial sector players like NBFCs and HFCs, but excluding banks, with assets worth of at least Rs 500 crore to insolvency courts.
As of July 2019, the home financier owed Rs 83,873 crore to banks, the National Housing Board, mutual funds and bondholders, including retail bondholders.
Of this, secured debt is Rs 74,054 crore and Rs 9,818 crore is unsecured.
Most banks have or are going to declare DHFL account as NPA in the third quarter.
DHFL defaulted on its payment obligations in respect of bank borrowings and market borrowings, which reveals serious concerns about the conduct of the affairs of the company, the RBI said.
DHFL lenders were working on a resolution plan to pick up 51 per cent in the company by converting a part of their debt into equity. But the plan was yet to be formally cleared.
