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While acknowledging the substantial progress made in cleaning up banks' balance sheets, the Deputy Governor also underscored potential areas of improvement.The event brought together distinguished experts and practitioners from across jurisdictions to share insights and experiences in insolvency resolution.Suggesting the need to improve the overall resolution ecosystem, RBI DG stated that a better understanding of the reasons behind defaults are …

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The Delhi High Court bench of Justice Mini Pushkarna held that the concerned party must be provided with all requisite documents that form the basis of Show Cause Notices by the banks. The Petitioner approached the Delhi High Court seeking the quashing and setting aside of Show Cause Notices issued by several respondent banks, which declared the account of M/s …

NEW DELHI: The Insolvency and Bankruptcy Code has resolved 891 cases of defaults involving banks loans worth R10 lakh crore till December 2023. According to IBBI’s quarterly report, 27,500 applications for initiation of corporate insolvency resolution process against companies involving defaults of R9.74 lakh crore were withdrawn before admission. As many as 79 corporate insolvency cases were resolved in the …

India on April 26 appealed to the members of the Shanghai Cooperation Organisation Interbank Consortium to increase interaction and cooperation among themselves. Addressing the 19th SCO IBC meeting in South Goa district, Managing Director of the India Infrastructure Finance Company Limited Padmanabhan Raja Jaishankar said the huge potential for cooperation between the banks of the member countries still remains untapped. …

Banks bear brunt of IBC’s quick resolutions

The Insolvency and Bankruptcy Code was expected to vastly improve recovery for banks and reduce the time taken to resolve default cases. Recently, the Reserve Bank of India in its Financial Stability Report said that recovery through resolutions should not be compared with claims submitted by banks. Before IBC came into force, average recoveries were 26% and the time taken …

Impossible to accept 95% haircuts for banks under IBC: Sitharaman

It is unacceptable that banks should take a hefty haircut on loans that go through the resolution process under the Insolvency and Bankruptcy Code, Finance Minister Nirmala Sitharaman said on Saturday, calling for greater efforts from resolution professionals to avoid fingers being pointed at such deals. The Minister also sought steps from the Insolvency and Bankruptcy Board of India for …

Comparing outstanding loan amounts with the value realised may not be a 'reasonable indicator' to assess the bankruptcy law's effectiveness, said Reserve Bank Deputy Governor M. Rajeshwar Rao, while seeking to address concerns over deep haircuts that banks had taken in some of the insolvency resolutions plans. "Rather, the resolution values must be compared with the next best alternative for …

Banks to take Future to debt recovery tribunal

Over the years, concerted efforts have been made to determine and resolve non-performing assets of banks and financial institutions in our country. As per the RBI’s March Financial Stability Report, gross NPAs are expected to be slightly elevated at around 11.22% of overall credit deployment by March 2022 for all scheduled commercial banks. In an effort to trim NPAs, a …

National Asset Reconstruction Company Limited is another attempt being made to resolve the NPA issue. DRTs, Lok Adalats, ARCs and IBC have all been routes chosen by the government in the past to take on the bad loans of banks so that they could concentrate on banking rather than resolving bad loans. IBC too has witnessed diminishing returns literally with …

Explained | Will the money recovered from Vijay Mallya, Nirav Modi and Mehul Choksi help banks?

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SC upholds Centre's notification permitting banks to proceed against personal guarantors under IBC

The Supreme Court on Friday upheld the validity of the Centre's notification allowing banks to proceed against personal guarantors for recovery of loans given to a company under the Insolvency and Bankruptcy Code. A bench comprising justices L Nageswara Rao and S Ravindra Bhat held that approval of the resolution plan under the IBC does not discharge personal guarantors of …

The story so far: After losses in two consecutive years, India’s scheduled commercial banks turned profitable in 2019-20. The Reserve Bank of India reckons that the first half of 2020-21 saw even greater improvements in banks’ vital statistics, with non-performing assets falling to 7.5% of outstanding loans by September 2020. What former Chief Economic Adviser Arvind Subramanian had called India’s …

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