The resolution plan will likely constitute of securitisation of assets and conversion of debt into equity as an interim measure until a new investor is found.
Lenders to the troubled non-banking finance company (NBFC) Dewan Housing Finance (DHFL) have decided to sign the inter-creditor agreement to implement the resolution plan by July 5, reported CNBC-TV18.
In a meeting held on July 1, the consortium of lenders led by Union Bank of India agreed to set the reference date for DHFL as June 29, which marks the start of the 30-day review period as per regulatory norms.
The resolution plan will likely constitute of securitisation of assets and conversion of debt into equity as an interim measure until a new investor is found.
As per guidelines issued by the Reserve Bank of India (RBI), banks need to start working on a resolution plan within 30 days of default by a borrower. Once the plan is agreed upon, it needs to be implemented within 180 days timeline, failing which banks will have to make excess provisioning.
DHFL missed its deadline to pay Rs 225 crore towards unsecured commercial papers on June 25. Earlier, it had delayed the payment of Rs 1,150 crore to its bondholders due on June 4, by a week.India Union Budget 2019: What does Finance Minister Nirmala Sitharaman have up her sleeve? Click here for top and latest Budget news, views and analyses.
