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

A report prepared by Grant Thornton shows that IL&FS Financial Services (IFIN) on the behest of its Committee of Directors continued lending to companies which were under financial stress and not in a position to repay loans, despite warnings from an the company's ASF (Asset and Structure Finance) team."We have indentified 73 instances amounting to Rs 9,193 crore where loans were sanctioned and approved by the CoD (Committee of Directors) even after the adverse remarks or recommendations by the ASF team. The outstanding amount as on September 30, 2018 of loans sanctioned to such entities amounts to Rs 6,230 crore," said the report.Further, out of the 73 instances, 46 instances amounting to Rs 5,544 crore were such, where either the loans sanctioned to such parties have become non-performing assets (NPA) or have been written off from the books of accounts of IFIN."Hence, it appears that loans were sanctioned by the CoD even when it was highlighted to them that the companies are under stress and doubts were raised about their ability to repay the loan."Citing the RBI inspection report for the financial year 2018, issued on March 22, 2019, Grant Thornton said that there were "serious deficiencies" in the credit appraisal process. Further the RBI report also noted that the loans were sanctioned overlooking the creditworthiness of the borrowers, it said."Also, evergreening of loans were noted by RBI," it added.The report cited the example of loan sanctioned to an Era group company named 'Dev Rishabh Real Estate Private Ltd'. IFIN sanctioned a loan of Rs 175 crore to the company on March 28, 2017.A review of the Credit Approval Memorandum (CAM) by Grant Thornton showed that the ASF team had adversely commented on borrower and said: "The Era group is facing overall liquidity issues and there have been issues in the repayments of loans to IFIN and other lenders.""Loans provided to two of the group companies of Era i.e. Adel Landmarks Ltd and Hi-Point Invesment and Finance Private Ltd had become NPA since July 30, 2016 and August 30, 2016 respectively," it added among other comments.The Grant Thornton's report said that as on September 30, 2018, Rs 117 crore is outstanding against the loan provided to Dev Rishabh Real Estate Private Ltd and the total amount outstanding for Era group is Rs 294 crore.All the loans to Era group have become NPA as on September 30, 2018, the report noted.( With inputs from IANS )

RbiFOLLOW

Rbi, Latest News

The Reserve Bank of India (RBI) employees union has urged the central bank to seek consensus on the Bimal Jalan panel report "in view of wider and long-term implications of the recommendations, irreversibility thereof" . ...

After it returned to power with a thumping majority this May, the exhilaration of having achieved 303 seats dimmed slightly for the BJP with Arun Jaitley's announcement that he would not be a part of the Narendra Modi government. The party's chief tr ...

With the economy in slowdown mode and expected to falter further, the Modi government on Friday came out with slew of measures including the reversal of the income tax surcharge on FPIs, an upfront recap of PSBs and relief for the struggling auto sec ...

The Reserve Bank of India had raised quite a few eyebrows when it announced an unconventional 35 basis points rate cut during its bi-monthly policy meet earlier this month. ...

policy is now conclusively on ensuring better transmission. Towards this, for the first time in recent history the RBI has consciously moved liquidity stance to positive. Indeed, the Governor has lately referred to the Rs 1-1.5 lakh crore positive sy ...

Violating regulations and advisories seems to be a part of the 'standard operating procedure' of the crisis-ridden IL&FS and its group companies, during the erstwhile management's administration. ...

The rot at IL&FS started right from the top. Fresh revelations show how the Managing Director of IL&FS flouted rules and whose corrupt practices pretty much triggered the liquidity crises in India. ...

The liquidity crisis in the lending major IL&FS and its group companies such as IFIN is something the erstwhile management itself created and should have been aware of the dire consequences of their blatant financial mismanagement. ...