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Tag: resolution

DHFL: Resolution professional discusses plan with lenders

DHFL: Resolution professional discusses plan with lenders

Finance
MUMBAI: The Reserve Bank-appointed administrator Monday met committee of creditors (CoC) of Dewan Housing Finance (DHFL) and discussed about the resolution plan for the crippled lender and the Rs 87,905.6 crore worth of claims received from banks, employees and bond holders, sources said. The administrator, R Subramaniakumar, met the committee of creditors for the first meeting after the stressed financier was admitted for insolvency proceedings on December 2. "This was the first meeting of CoC. The RP (administrator) discussed about the resolution plan and the way forward," a banker who attended the meeting said. All creditors of the company including banks, bond holders, insurance and mutual fund companies attended the meeting. "The CoC also discussed about the claims which have been sub...
IBBI tightens norms for insolvency resolution professionals

IBBI tightens norms for insolvency resolution professionals

Finance
NEW DELHI: In a significant move, the Insolvency and Bankruptcy Board of India (IBBI) has tightened norms governing resolution professionals wherein restrictions will also be in place for their relatives from taking up employment after completion of a resolution process. Insolvency resolution professionals would be barred from having employment when they are in possession of authorisation to take up work under the insolvency law. Besides, an insolvency professional and his or her relatives cannot accept any employment from the successful resolution applicant concerned for one year, as per the amended norms. An insolvency professional should not undertake any assignment unless he or she holds an 'Authorisation for Assignment' issued by the insolvency professional agency concerned. This woul...
Balance between maximising profit and minimising time needed in resolution process

Balance between maximising profit and minimising time needed in resolution process

Finance
By Taponeel MukherjeeAs news regarding recapitalisation of Public Sector Banks (PSBs) and the need to improve credit availability come to the fore, one crucial issue that is assuming increasing importance is the need to maximise the "time value of money" of loans by ensuring faster resolution of credit issues. An effective resolution of non-performing assets (NPA) requires the balancing of two aspects of loan recovery value maximisation, i.e., a higher recovery amount and a quicker recovery process. In an ideal scenario, a lender would wish to maximise the value of the loan recovered, and yet achieve this in quick time. However, in reality, the two factors usually work in opposite directions. A focus purely on maximising the actual loan recovery amount can lead to situations whereby the le...
RBI may offer more time for bank-led resolution of NPAs

RBI may offer more time for bank-led resolution of NPAs

Finance
The RBI is likely to adopt a more accommodative approach towards resolution of stressed assets when it issues a revised circular, replacing the controversial February 12 circular quashed by the Supreme Court. Sources said the major contention in the Resrserve Bank of India's (RBI) controversial February 12, 2018, circular, including the one-day default norm, that was challenged in the court leading to its quashing, will be done away with in the new circular. Instead, banks will be given 30 days time from the first default to identify and qualify an account as a bad debt (special mention account or SMA) and initiate a resolution exercise. Besides, the 180-day period given for completing the bank-led resolution will start only after an account is declared an SMA I thirty days from first defa...