Ex-Aircel promoter Sivasankaran’s cos, top bankers booked in Rs 6-bn fraud
The CBI has registered a case against former Aircel promoter C Sivasankaran’s two companies and MD and CEO of Syndicate Bank and Indian Bank for allegedly defaulting on loans worth Rs 6 billion taken from IDBI Bank, officials said on Thursday. Sivasankaran’s firms had allegedly taken a loan of Rs 5.3 billion in February 2014. The amount increased to Rs 6 billion after becoming a non-performing asset, they said.
Essar Steel sale: Numetal moves NCLAT against NCLT; Arcelor writes to SBI
Numetal has moved the National Company Law Appellate Tribunal (NCLAT) challenging the NCLT order that pointed towards payment of overdue amount for ArcelorMittal to cure its ineligibility. Legal sources in Numetal said the NCLT order, which suggested a 30-day cure period for payment of overdue for ArcelorMittal, wasn’t applicable. It was applicable to companies who had bid before the IBC amendment, but ArcelorMittal submitted its bid for Essar Steel after the amendment, they said.
Allow promoters to bid under IBC if not wilful defaulters: CII
Promoters of stressed assets should be allowed to bid under the Insolvency and Bankruptcy Code in case they are not wilful defaulters and the company has suffered on account of sectoral reasons, CII President Rakesh Bharti Mittal said today. The government has prohibited promoters of loan-defaulting companies from bidding under the insolvency process citing ethical reasons. “Where there is no wilful default or fraud, my view is that the promoter should be given a chance (to bid) if the loan default is due to stress in the sector,” the new CII president told PTI.
Systems, practices need to develop before allowing pre-packs: IBBI chief
Business enterprises may have to wait for some time to use the concept of “pre-packs” as part of the insolvency regime, Insolvency and Bankruptcy Board of India Chairman MS Sahoo has indicated. “Time has come to think about it (pre-packs). But it is little early to implement it here. Let systems and practices develop little more before we take the step of introducing pre-packs in our insolvency regime,” Sahoo told Business Line. His remarks are significant as it comes on the heels of NCLT President MM Kumar recently making a case for India to consider introduction of “pre-packs” in its insolvency regime.
AS NPAS RISE, BANKS STRENGTHEN CREDIT MONITORING DEPARTMENTS
Banks are strengthening their credit monitoring departments to ensure that loans don’t get into restructuring mode, with attendant provisioning consequences, as the Reserve Bank of India’s revised framework for resolution of stressed assets does not brook even a day’s default. Under the revised framework, which was unveiled on February 12, banks are expected to pick up signs of incipient stress even before they get classified as special mention account (SMA)-0, say bankers. SMA-0 accounts are those which throw up early warning signals of stress and where the principal, or interest payment, or any other amount – wholly or partly – is overdue between 1-30 days.
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