Lenders Sign Inter-Creditor Agreements To Speed Up Bad Loan Resolution

Lenders Sign Inter-Creditor Agreements To Speed Up Bad Loan Resolution

Led by SBI, the country’s lenders have agreed to sign an inter-creditor that hopes to speed up the process of stressed asset resolution. In an exchange filing, SBI said that its board has approved the signing of the inter-creditor pact. Most of the other 76 lenders are expected to follow suit, sources said. The inter-creditor agreements are part of the ‘Sashakt’ resolution framework released by banks in July. The new framework puts the onus on the lead lender, who is then responsible for submitting a resolution plan for stressed assets to an overseeing committee. Terms of resolution plan will need to be approved by 66% of lenders and shall be final and binding. The framework also envisages the setting up of an asset management company, which raises an alternative investment fund to invest in stressed assets.

Read More at Bloomberg Quint News date : 23 Jul 2018, Monday

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