NEW DELHI: Finance Minister Nirmala Sitharaman on Thursday called for a “swift implementation” of bank resolution plans aimed at reviving companies affected by the COVID-19 pandemic, and called on lenders to renew plans before September 15.
Sitharaman also called on lenders to support borrowers, as the moratorium on loan repayments is lifted, adding that the anguish caused by the pandemic should not affect lenders’ assessment of their creditworthiness.
“During her interaction, the finance minister focused on lenders immediately establishing a board-approved resolution policy, identifying eligible borrowers and contacting them. Rapid implementation of a sustained resolution plan by lenders for the reactivation of all viable businesses, “the ministry said in a statement.
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Sitharaman today held a virtual review meeting with heads of banks and non-bank finance companies for a smooth and rapid implementation of the unique debt restructuring for the resolution of stress related to covid-19 in bank loans.
The Reserve Bank of India (RBI) last month had allowed the one-time restructuring of corporate and retail loans without classifying them as a non-performing asset (NPA).
“Lenders assured that they are ready with their resolution policies, have begun the process of identifying and contacting eligible borrowers, and that they will meet the deadlines stipulated by the Reserve Bank of India (RBI),” the statement said. of the Ministry of Finance. additional.
This meeting took place before the recommendations of the panel led by KV Kamath on the eligibility parameters for the restructuring of loans affected by the covid-19 crisis. Last month, RBI Governor Shaktikanta Das said that a resolution framework for all stressed accounts related to covid-19 will be finalized on September 6. The restructuring of some loans will support the economic recovery and help companies to overcome the crisis.
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