IL&FS defaults can lead to systemic risks in financial sector, says DEA

The Department of Economic Affairs (DEA) has come down hard on the state of affairs at Infrastructure Leasing & Financial Services (IL&FS) in its petition to the National Company Law Tribunal. It has said that defaults by the group can lead to systemic risks in the financial sector. 

“There is a substantial public interest in ensuring financial solvency and good governance and management of this Group. The cascading impact of the default by the IL&FS Group on the financial sector would be quite substantial as evidenced from a partial default of some companies.” 

The main is the group’s dwindling finances.