Following an NCLAT order, the Reserve Bank of India (RBI) has withdrawn its circular asking banks and financial institutions to declare details of their exposure and provisions related to the crisis-hit IL&FS.
Last week, the National Company Law Appellate Tribunal (NCLAT) had allowed banks to declare their defaulting accounts of Infrastructure Leasing & Financial Services (IL&FS) and its group companies as non-performing assets.
“In view of the NCLAT order dated May 2, 2019…the instructions contained in (April 24) circular stand withdrawn,” the RBI said Wednesday. The circular had asked banks and financial institutions to disclosure their exposure to IL&FS and its group entities as the NCLAT verdict was pending.
The cash-strapped IL&FS group is sitting on a debt of about Rs 94,000 crore. Several group companies have defaulted on the payment of interest payment on loans.
Source- Business Today.