Any resolution plan which is finalised outside the ambit of the Insolvency and Bankruptcy Code (IBC) for the next set of stressed assets, will be subject to a rating requirement by two external credit rating agencies for the purpose of bank loan rating, the Reserve Bank of India (RBI) said.
The apex bank outlined that in case the plan fails to get rated, the account would be referred for resolution under IBC before December 31, 2017, Business Standard (BS) reported.
The lenders have informally informed the companies regarding the on-the-rating requirement, but official communication is yet to be initiated.
The banking regulator in a letter dated August 28, told banks about the resolution of non-performing assets (NPAs) other than the 12 identified for immediate reference for resolution under the IBC, by December 13, BS reported.
RBI also cautioned banks that in case the deadline of December 13 is not met for the accounts, it would be referred for resolution under the IBC by December 31.
"Earlier, the RBI had given a list of 12 companies for resolution and the latest letter is basically a follow-up on that. The consortium of lenders will take a view on each of the companies. For other companies too, quite a few could go to the National Company Law Tribunal (NCLT), as most of the accounts have been declared NPAs. If the credit rating exercise is done, there is no question of a good rating," BS quoted UCO Bank Managing Director and Chief Executive Officer (CEO) R K Takkar as saying.
Back in June, RBI had identified 12 of the largest loan defaulters and ordered lenders to start bankruptcy proceedings against them to start unclogging the $150 billion (around 9.75 lakh crore) in bad debt plaguing Asia's third largest economy.
The twelve accounts from the first list constitute as much as one-fourth of the bad loans in the banking system, or about Rs 2 lakh crore.
