Administrator of DHFL meets lenders today to take stock of their claims

The Reserve Bank of India-appointed administrator is set to meet lenders to Dewan Housing Finance Corporation (DHFL) on Thursday to take stock of claims made by them. The administrator, R Subramaniakumar, had set a deadline of December 17, 2019 for creditors to submit their claims. Lenders comprising banks, bondholders, including retail bondholders, and employees are said to have submitted claims totalling Rs 87,905 crore. 

The meeting will also discuss the resolution plan and evaluate the possibility of restarting lending operations. A few bankers said while some of their claims may be approved in the meeting, the dissent among lenders to ratify the resolution plan too is rising. 

“After IndusInd Bank classifying its exposure to DHFL as fraud and providing for it accordingly, more lenders could do so,” said a senior bank executive under conditions of anonymity. IndusInd Bank had lent Rs 240 crore to DHFL by way of non-convertible debentures. Even as the final forensic report from KPMG is pending, IndusInd Bank is said to have made this provision on prudential basis. 

The DHFL spokesperson, however, clarified that one bank’s move may not have a bearing on other banks. 

Under the proposed resolution plan put forward by former DHFL management, banks would restart lending to DHFL and extend the tenure of loans upwards of eight years. “Once there are charges of fraud, banks would be hesitant to provide additional loans to a borrower,” said a top executive of a public sector bank. 

As part of the resolution plan, DHFL also needs to find an investor bringing fresh capital. While a few investors were interested earlier, bankers say that may not be the case if support from lenders does not come through as proposed.