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Home > Business > Business Headline > Report
'IDBI debt revamp going well'
April 07, 2003 18:32 IST
The corporate debt restructuring programme, initiated by the Industrial Development Bank of India and 59 other banks and financial institutions in the country, has been progressing well with 29 cases, involving Rs 29,069 crore (Rs 290.69 billion), being finally settled.
Informing this, IDBI Chairman P P Vora told a banking summit in Mumbai that the Debt Restructuring Committee had received 60 cases amounting to Rs 44,595 crore (Rs 445.95 billion) of which 15 applications (Rs 6,405 crore or Rs 64.05 billion) were rejected due to non-fulfillment of criteria.
Sixteen cases amounting to Rs 9,121 crore (Rs 91.21 billion) were currently being processed by the committee, he said.
Twenty-seven public sector units and 22 private firms had so far participated in the debt restructuring process, Vora said adding that this include 15 cases related to textile units, nine petrochemical units and eight steel companies.
Vora also said that around 20 non-performing assets involving a sum of Rs 2,000 crore (Rs 20 billion) had been referred to the Assets Reconstruction Committee.
He said that there is need for greater co-relation mechanism between CDR and ARC because assets, being standard or sub-standard, cannot automatically be referred to ARC.
Only NPAs are eligible for transfer to ARC at an appropriate valuation, he said.
The State Bank of India Deputy Managing Director Chandan Bhattacharya said that banks were in the learning proces as to how to deal with NPAs, particularly in case of applicability of the Securitisation Act.
Sometimes, it was seen that there were no buyers in auction of any standard or sub-standard assets before transfering the case to ARC, he said.
The success of ARC largely depends on the legal and working environment and this can be achieved through a viable debt restructuring measure, he said and added that it called for empowering of officers of the banking industry. UNI
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