Finance English news | Finance, Latest News & Live Updates in English | English News (Latest English News) at Lokmattimes.com

"The guidelines are ready, we will issue them in 1 to 2 days time", Finance and Banking Secretary Rajeev Kumar said here during a review on the performance of state-run banks.Last week, the Finance Ministry had said it would put in place an oversight mechanism for the one-time partial credit guarantee scheme for PSBs to purchase high-rated pooled assets of financially sound NBFCs as announced in the Budget 2019-20.The government has received a proposal from the Reserve Bank of India (RBI) on the draft modalities of the credit guarantee scheme, which would be operationalised by the RBI.Presenting her maiden Union Budget in July, Finance Minister Nirmala Sitharaman had announced that the government would provide a one-time partial credit guarantee of six months to PSBs for the first loss of up to 10 per cent to enable them to purchase pooled assets of financially sound NBFCs amounting to Rs 1 lakh crore.This was aimed at ensuring financial support to the stressed housing finance companies (HFCs) and NBFCs which were facing a severe liquidity crunch following the series of payment defaults by IL&FS. This caused the drying up of bank funds to the NBFCs and HFCs from lenders fearing further addition to their massive non-performing assets (NPAs or bad loans), creating, thereby, a spiral effect on the economy."This would ease the liquidity stress in the NBFC sector and increase the access of these NBFCs to bank finance and, in turn, would enable them to continue to play their role in meeting the financing requirements of the economy", the statement said.Sources here said the state-run banks would be allowed to pick up primarily 'AAA' rated assets of the NBFCs who have not defaulted, while only banks outside the RBI's Prompt Corrective Action (PCA) framework for resolving bad loans and those with strong balance sheets like State Bank of India (SBI), Canara Bank and Bank of Baroda would be allowed to participate in the scheme.In a bid to improve regulatory oversight, the government has also proposed to bring housing finance companies under the RBI, removing them from the control of the National Housing Bank. All these steps are aimed at improving the condition of the NBFC sector as a whole.( With inputs from IANS )

FinanceFOLLOW

Finance, Latest News

A team from Ministry of Home Affairs (MHA) visited villages affected by cloudbursts and heavy rainfall in the Chamoli district here to take stock of the damages incurred due to the calamity. ...

After DMK's M.K. Stalin, support for P. Chidambaram came in from West Bengal Chief Minister Mamata Banerjee who hit out at the Central government over the arrest of the senior Congress leader by the Central Bureau of Investigation (CBI) on Wednesday ...

After former Finance Minister P Chidambaram was arrested by CBI on Wednesday night in connection with INX Media case, his son Karti Chidambaram on Thursday said they will fight this "trumped-up and vindictive act" by a "pliant agency" politically and ...

The government on Monday removed the requirement of 'Debenture Redemption Reserve' (DRR) for listed companies, non-banking financial companies (NBFCs) and housing finance companies (HFCs). ...

In a sweeping recommendation, a high-level committee led by Corporate Affairs Secretary Injeti Srinivas has proposed to make corporate social responsibility (CSR) expenditure tax-deductible and allow companies to carry forward the unspent balance for ...

Vice President Venkaiah Naidu on Saturday visited the All India Institute of Medical Sciences (AIIMS), where former Finance Minister Arun Jaitley is admitted, and was informed by doctors that the BJP leader is responding to treatment. ...

The slowdown-hit economy may soon get a booster dose from the government with the Finance Ministry working on a stimulus package for the industry including a slew of financial measures ranging from tax cuts, subsidies and other incentives, sources sa ...

The Department of Financial Services (DFS) will issue the norms for the one-time partial credit guarantee scheme for public sector banks (PSBs) to purchase high-rated pooled assets of financially sound non-banking finance companies (NBFCs), a senior ...