Wednesday, June 16, 2021
Home > Finance News > Expect Religare Finvest’s debt restructuring to be over in 2 months, says official

Expect Religare Finvest’s debt restructuring to be over in 2 months, says official


With debt restructuring plan getting approved by a consortium of 18 lenders led by SBI, Religare Finvest Ltd is gearing up for new business, Enterprises Chairperson Rashmi Saluja said.

RFL, an NBFC arm of Religare Enterprises Ltd, has been barred from undertaking fresh business as it is under corrective action plan (CAP) of the Reserve Bank of India (RBI) since January 2018 due to its weak financial health.

In line with the debt restructuring plan, Saluja said the company paid Rs 400 crore to lenders on March 31, 2021.

“Entire debt restructuring (DR) plan should see light of the day in two-months…this time Religare Enterprises Ltd (REL) itself is proposing DR plan in which case we may not need “fit and proper” approval of RBI as REL is registered entity with the RBI,” she told PTI in an interview.

The earlier DR plan was rejected by the Reserve Bank of India (RBI) in March 2020 as the suitor–TCG Advisory Pvt. Ltd, a part of The Chatterjee Group–for the RFL was not found to be ‘fit and proper’ by the regulator.

Once the latest debt restructuring is done, she said, the next process would be to approach the regulator to consider removing the company from the corrective action plan (CAP).

RFL has repaid close to Rs 7,500 crore since 2018, she said, adding that the company is actively pursuing recovery cases, including Lakshmi Vilas Bank (now DBS India).

The court has given DBS India notice by making them a party which makes the company hopeful of realisation of money, she said.

RFL expects to recover its fixed deposits, with an interest of around Rs 950 crore from debt-ridden Lakshmi Vilas Bank (LVB), whose officials allegedly misappropriated the FD amount in connivance with erstwhile Religare promoters Singh brothers.

The company has been in financial distress due to alleged misappropriation of funds by erstwhile promoters Shivinder Singh and his brother Malvinder Singh. Multiple investigative agencies are probing the case of financial bungling of about Rs 4,000 crore.

Asked about recent RFL’s disclosure of possible default on payment obligation related to Rs 100 crore NCDs, she said, these non-convertible debentures (NCDs) were issued to Axis Bank, being one of the lenders to RFL, was signatory to the earlier ICA (Inter Creditors Agreement) in July 2019.

Axis Bank as part of a consortium of lenders has been informed about the revised DR Plan with Religare Enterprises continuing as promoter of RFL and also sought their full support for approval and implementation of the same, she said.

“So, it will have no impact on the DR plan as it is unsecured. It is in line with the DR proposal. It’s more of a procedure than a default,” she added.

Besides RFL, Care Health Insurance Limited (CHIL) and Religare Broking Limited are the other subsidiaries of Religare Enterprises.

Debt-ridden RFL also has a subsidiary, Religare Housing Development Finance Corporation Limited (RHDFCL), which is into affordable housing finance.

While health insurance and retail broking arms are flourishing, the housing finance company navigated through the COVID-19 period and is doing very well, she added.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: