Rather, the existing ones should be implemented speedily to clean up the mess.
The Reserve Bank of India (RBI) has offered some leeway to banks for early detection and resolution of bad loans. Under the new regime kicking off from April 1, lenders can finance 50 per cent of the outstanding loan value, RBI said in Framework for Revitalising Distressed Assets in the Economy, released on Thursday.
Property buyers fund the project cost and the entire debt and entire equity servicing, and yet, have no locus standi in the IBC process, points out Debashis Basu.
Expect a more modest out-turn of around 5 per cent (if not less) because of the longer-term scarring effects of the Covid shock, the sharply slowing growth in the pre-Covid years and some scepticism about the growth-efficacy of some of recent official policy initiatives, explains Shankar Acharya, former chief economic advisor to the government.
GNPAs of public sector banks are now at a staggering 11.2 per cent of their advances.
With the Jaypee acquisition, the Suraksha group, which made lenders an offer of Rs 7,736 crore, will be able to expand its footprint in north India after making inroads in Mumbai's real estate market over the past year. Sudhir Valia, the promoter, was a co-founder and executive director of India's biggest pharmaceutical firm, Sun Pharmaceuticals, and is a close relative of Dilip Shanghvi.
The sale of the NPA account is to happen through e-auction on January 30, as per the bid invite.
Recently, CVC suggested that banks have a monitoring mechanism for bad loan sales to ARCs, with the cash flow statement from stressed assets shared with banks.
'The rate cut will reduce the stress on customers and help the bank reduce its provisioning bill.'
Banks feel happy shifting their toxic assets from loan books to investment books while the ARCs enjoy the management fees with a smile, observes Tamal Bandyopadhyay.
'One of the ways to do that is to ensure that NBFCs have got liquidity.' 'If we don't do that, this mood of gloom will continue.' NBFCs need to be provided with liquidity if they have to start lending.
Retaining the GST rate assumes importance since states are under pressure to increase their revenues, hit hard by lockdown. Also, the Centre has not fully compensated states for their revenue losses on account of GST for 2019-20.
Lenders say settlements will cross over 100 accounts in the March quarter.
The central bank has ordered lenders to clean up balance sheets by March 2017
RBI said the improvement in asset quality was driven by state-run lenders which saw a drop both in both GNPA and in the net NPA ratios.
The meeting is expected to chart a road map for cleaning up their balance sheets and boost credit flows, reports Somesh Jha.
Among India's capital-starved local banks, Essar is viewed as too big to fail.
The move came as the country badly needs capital inflows as the rupee comes under pressure
'Infusion of fresh capital, handsome growth in deposits and focus on recovery should bring Yes Bank back on the growth path in the next financial year,' observes Tamal Bandyopodhyay.
Why do we need a bad bank, owned by the banks themselves when there are at least 28 ARCs around, asks Tamal Bandyopadhyay.
The government on Friday gave wide-ranging legislative powers to the Reserve Bank of India to issue directions to lenders to initiate insolvency proceedings for the recovery of bad loans.
The Finance Ministry is considering a proposal to set up a National Asset Management Company that may act as a nodal agency for taking over bad loans of banks and help revive sick units.
Piramal will join the JSW, Vedanta and Tata groups, which are bidding aggressively for distressed assets, especially in the infrastructure and steel sectors.
The three companies for sale are Reliance Communications, Reliance Telecom and Reliance Infratel.
The investment limit for foreign entities in Indian stock exchanges will be enhanced from 5 per cent to 15 per cent on par with domestic institutions.
Seeking to spur foreign investments, Finance Minister P Chidambaram has said the Union Cabinet will decide on raising FDI caps in different sectors in the third week of this month.
Punjab National Bank has the largest share.
With assets depreciating over time, it will lead to large haircuts for lenders and creditors, say experts
The move comes ahead of the tighter provisioning norms kicking in from next April
Banks might not have realised the exact implication of risky projects under PPP projects, which were getting implemented under high leverage
Bankers say there is palpable fear among erring promoters that the banking system just cannot be taken for granted, and any delay in loan repayment could mean promoters losing business
Shapoorji, Kalpataru, Godrej pursuing Rs 60,000 crore opportunity in the region
A roadmap for the consolidation of public sector banks will be outlined during the year.
Reserve Bank of India Governor Raghuram Rajan had said recently that there was "no need" to set up a separate bad bank to deal with stressed assets of public sector lenders.
Let all the stakeholders, especially the government, remember that if the Make in India lion needs to roar and rise again, it won't happen unless India Inc rises too, points out Shekaar Subramanian.
Bankruptcy proceedings are going at a slower pace than what the bankers had envisaged and many cases have gone beyond the 270-day timeline set under the IBC mainly because of litigation.
The amount of loans that carry a high risk of slippage into the NPA category over the next few quarters is about Rs 2.8 trillion.
RBI has identified about 50 cases for NPA resolution after it was empowered by the government to ask banks to initiate insolvency proceedings.
To make sure liquid schemes reflect the underlying portfolio risks, Sebi has said all debt papers with maturity of 30 days or more to be marked to market. Earlier, fund houses didn't have to do so for securities that had less than 60-day maturity.
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