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14
June 2017
The
RBI on Tuesday identified 12 accounts totaling 25 per cent of the
non-performing assets (NPAs), or bad loans, of the banking system for
insolvency proceedings, a day after Finance Minister Arun Jaitley said action
was on the anvil shortly in this regard.
"The
IAC (Internal Advisory Committee) noted that under the recommended criterion,
12 accounts totaling about 25 per cent of the current gross NPAs of the banking
system would qualify for immediate reference under IBC (Insolvency and
Bankruptcy Code, 2016)," the Reserve Bank of India said in a statement
following the IAC's first meeting here on Monday.
"The
IAC recommended for IBC reference all accounts with fund and non-fund based
outstanding amount greater than Rs 5,000 crore, with 60 per cent or more
classified as non-performing by banks as of March 31, 2016," it
said. The Total Investment & Insurance
Solutions
The
IAC has been constituted under the Banking Regulation (Amendment) Ordinance,
2017, passed by the government last month, that allowed more power to the RBI
to tackle the NPAs issue. It has been empowered to issue directions to
commercial banks to initiate insolvency proceedings for recovering bad loans. The Total Investment & Insurance Solutions
"The
IAC took up for consideration the accounts which were classified partly or
wholly as non-performing from amongst the top 500 exposures in the banking
system," the RBI said.
Following
his annual review in New Delhi of the performance of public sector banks (PSBs)
on Monday, Jaitley told reporters that he expects "precipitative
action" to be taken after the recent ordinance on bad loans, and this
could strengthen recovery efforts of PSBs.
He
said the RBI is at a fairly advanced stage of preparing a list of debtors whose
cases require resolution through the IBC process, and added that 81 cases have
been filed under IBC, with 18 of them coming from financial creditors. The Total Investment & Insurance Solutions
The
NPAs of state-run banks at the end of last September rose to Rs 6.3 lakh crore
(almost $100 billion), as compared to Rs 5.5 lakh crore at the end of June
2016.The Total Investment & Insurance
Solutions
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