Page 9 - Non-banking Finance Companies

NBFCs, HFCs rated up to BBB+ come under partial credit guarantee scheme

This will allow public sector banks (PSBs) to buy pooled assets from financially sound entities

Banking funds have gained from global inflows amid US-China deal hopes

But beware that NBFCs with high exposure to real estate are not out of the woods yet

Liquidity pressures faced by NBFCs, HFCs, to continue: Fitch Ratings

Liquidity pressures faced by the non-banking financial sector following the IL&FS failure are likely to continue though funding costs have come off the peak, Fitch Ratings said on Friday. "We view wholesale and housing finance companies (HFCs) as more vulnerable -- given their higher leverage, weaker asset-and-liability maturity (ALM) profiles and higher concentration risks. Large retail finance companies with well-managed ALM profiles should continue to access bank and capital markets funding. Further, funding diversification in the offshore markets by larger issuers would benefit their funding profiles," it said in its outlook for emerging market finance and leasing companies. Indian finance and leasing companies are likely to grow at a slower pace in 2020 than in prior years, amid weaker economic growth and liquidity constraints, it said. Fitch said its 2020 sector outlook is underpinned by challenging operating environments, lower growth prospects, and rising funding pressure.

Govt considers special window for resolution of stressed NBFCs under IBC

The move also comes against the backdrop of financial sector players like Dewan Housing Finance Corporation Ltd facing troubles

After DHFL crisis, centre to issue new rules to bring NBFCs under IBC

DHFL is one of the largest HFCs that ran into trouble last year soon after the collapse of IL&FS

Liquidity coverage ratio may not adversely impact growth of NBFCs

Initially, NBFCs have to maintain a minimum of 50 per cent of high quality liquid assets as part of the LCR, which will progressively touch 100 per cent by December 2024

NBFC crisis: Indian banks could face a $50-billion capital shortfall: Fitch

The weakest, including those with Viability Ratings in the 'b' range, would face heightened solvency risks without capital injections from the government, the rating agency said

BS Fund Manager: Unlike banks, mutual funds don't have NPAs, opine CIOs

Six of India's leading fund managers say it is unfair to compare the fund industry's issues with the banking sector's woes

Taking a step back helped beat competition: Fund Manager Shreyash Devalkar

Shreyash Devalkar of Axis Mutual Fund was able to deliver enviable returns by moving away from the herd even as mid- and small-caps struggled

NBFCs lure retail investors with high yields as banks tighten purse strings

Tata Capital Financial Services, a subsidiary of Tata Capital, said it would hit the market with tranche 2 of its NCD to raise up to Rs 4,126 crore

A challenge and an opportunity

As concerns move from liquidity to solvency of select NBFCs, uncertainty is the bigger challenge