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FM Piyush Goyal to meet heads of banks today to discuss NPA cases

The meeting has been organised by Indian Banks Association (IBA) and inter creditor agreement would be the framework under which the consortium would take up NPA cases

Press Trust of India  |  New Delhi 

Piyush Goyal at the Press Conference in Mumbai on Friday. Kamlesh Pednekar
File photo of Piyush Goyal at the Press Conference in Mumbai on Friday. Kamlesh Pednekar

Minister will meet heads of on Thursday to discuss an inter-lender structure suggested under the 'Project Sashakat' that intends to fastrack resolution of in the banking system.

The meeting is likely to formalise the inter-creditor agreement structure as suggested in the five-pronged 'Project Sashakat', sources said.

The meeting has been organised by Association (IBA) and inter creditor agreement would be the framework under which the consortium would take up cases.

The framework will authorise the lead bank to implement a resolution plan in 180 days and the leader would then prepare a resolution plan including empanelling turnaround specialists and other industry experts for operation turnaround of the assets within RBI's stipulated timeframe of 180 days. 

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As part of the framework independent screening committee of eminent personalities would be appointed by to validate due process within maximum 30 days and the resolution would proceed if lenders holding 66 per cent of debt give their nod in line with the NCLT process.

Once the resolution plan is approved, the lead bank would be responsible to execute the plan.

While accepting recommendation earlier this week, the Minister had said would set up independent (AMCs) and steering committees for faster resolution of bad loans.

A panel, headed by PNB non-executive chairman Sunil Mehta, recommended an asset management company/alternative investment fund (AIF)-led resolution approach under the five-pronged strategy to deal with cases of more than Rs 5 billion. 


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There are about 200 accounts, each of which owes more than Rs 500 crore to banks. Their total exposure is about Rs 3 .1 trillion

Giving details, Goyal had said under this approach, independent would be set up. AIF would raise funds from institutional investors.

The AMC, to be set up under AIF framework, will become a market maker and thereby ensuring healthy competition, fair price and cash recovery, the minister had said.

First Published: Wed, July 04 2018. 22:26 IST
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