CDR cell has received no debt recast requests thus far in FY15
In the FY15 thus far, the Corporate Debt Restructuring (CDR) cell has not received any debt recast requests; thanks to the new guidelines which have been put in place by the Reserve Bank of India with regard to the management of stressed assets.
The new RBI guidelines were announced in January, and became effective from April 1. The guidelines require banks to classify stressed accounts into three categories, on the basis of the extent of delays in repayment. In addition, banks are also required to share information on different borrowers with one another.
With the new guidelines issued by the RBI chiefly aimed at helping banks spot trouble early and take quick action to prevent assets from turning bad, the CDR cell has revealed that, so far this fiscal, there has not been even a single new case for a loan recast from member banks.
In comparison, in FTY14, more than Rs 1 lakh crore worth of loans were restructured by the CDR cell; marking the highest-ever loan restructuring in one year by the CDR cell. The recast request received by the cell in FY14 were for loans worth Rs 1.32 lakh crore; with companies seeking easier repayment terms including steelmakers, engineering firms, and realty firms.
About no debt recast requests thus far in FY15, senior bankers have asserted that, with accounts now being monitored closely for weaknesses and tackled accordingly, there have been no cases which required to be taken to the CDR cell for restructuring.
Source: The Financial Express
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