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New Delhi :

Stressed assets of about Rs 3 lakh crore could be headed towards the NCLT for resolution as the Reserve Bank of India is learned to have not considered the banks’ request to extend the January 7 timeline to come up with specific plans under inter-creditor agreements (ICAs) on dud assets.

Queries sent to the RBI did not elicit any response.

ICAs were taking several weeks to arrive at any consensus in many cases and the last date of signing ICAs was January 7 for loans exceeding Rs 2,000 crore. Banks were working on resolution plans for cases worth Rs 3 lakh crore. As per the June 7, 2019 RBI circular, they will have to make additional provisions of 20 percent against accounts where resolution plans are not signed and refer those to the National Company Law Tribunal (NCLT).

Resolution plans under the ICA framework have been taking time because banks and non-bank lenders, such as mutual funds and insurance companies, have differences of opinion. The lack of consensus among the various categories of lenders led to delays in putting together ICAs.

Banks had requested the RBI earlier this month to extend the deadline for inter-creditor pacts by 3 months till the end of the fiscal for those cases close to resolution so that these cases are not referred to the NCLT.

The ICA framework was set up to arrive at a resolution plan within a specific period (30+180 days) for bad loans without entering the NCLT process.

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