The
Reserve Bank of India (RBI) on Monday tightened norms for bad loan resolution
by setting timelines for resolving large NPAs, failing which banks will have to
mandatory refer them for insolvency proceedings. It also withdrew existing debt
restructuring schemes such as SDR and S4A.
RBI has
issued definitions of different resolution plans and an indicative list of
financial difficultly, and directed lenders to share data on certain defaulted
borrowers with the central bank’s database on large exposures on every Friday.
The large
accounts are mainly those where banks have initiated resolution and are
classified as restructured standard assets. Indian banks are sitting on a
stressed assets pool of over Rs10 trillion. Read More
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