RBI withdraws circular asking banks to declare exposure to crisis-hit IL&FS

Following an NCLAT order, the Reserve Bank of India (RBI) has withdrawn its circular asking banks and financial institutions to declare details of their exposure and provisions related to the crisis-hit IL&FS

Press Trust of India May 09, 2019 17:32:09 IST
RBI withdraws circular asking banks to declare exposure to crisis-hit IL&FS
  • In view of the NCLAT order dated 2 May, 2019...the instructions contained in (24 April) circular stand withdrawn, the RBI said on Wednesday

  • Last week, the NCLAT had allowed banks to declare their defaulting accounts of Infrastructure Leasing & Financial Services (IL&FS) and its group companies as non-performing assets

  • The RBI circular had asked banks and financial institutions to disclose their exposure to IL&FS and its group entities as the NCLAT verdict was pending

Mumbai: Following an NCLAT order, the Reserve Bank of India (RBI) has withdrawn its circular asking banks and financial institutions to declare details of their exposure and provisions related to the crisis-hit IL&FS.

RBI withdraws circular asking banks to declare exposure to crisishit ILFS

Representational image. Reuters.

Last week, the National Company Law Appellate Tribunal (NCLAT) had allowed banks to declare their defaulting accounts of Infrastructure Leasing & Financial Services (IL&FS) and its group companies as non-performing assets.

"In view of the NCLAT order dated 2 May, 2019...the instructions contained in (24 April) circular stand withdrawn," the RBI said on Wednesday.

The circular had asked banks and financial institutions to disclose their exposure to IL&FS and its group entities as the NCLAT verdict was pending.

The cash-strapped IIL&FS L&FS group is sitting on a debt of about Rs 94,000 crore.

Several group companies have defaulted on the payment of interest payment on loans.

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