The total lenders' exposure to the companies stands at about Rs 2 lakh crore, in comparison with the gross NPA tally of Rs 7 lakh crore in the banking sector.
Amtek Auto, Jyoti Structures, Lanco Infratech, Electrosteel Steels, Monnet Ispat, Jaypee Infratech, Alok Industries, Bhushan Steel and ABG Shipyard crashed up to 15 percent intraday Friday after sources told CNBC-TV18 that these companies are included in the list of 12 NPA accounts which qualified for immediate reference under Insolvency and Bankruptcy Code (IBC).
Among unlisted companies, Bhushan Power and Era Infra are also included in the list of NPA accounts, sources said.
The Reserve Bank of India on Tuesday said Internal Advisory Committee recommended for IBC reference all accounts with fund and non-fund based outstanding amount greater than Rs 5000 crore, with 60 percent or more classified as non-performing by banks as of March 31, 2016.
These 12 accounts totaled more than 25 percent of the current gross NPAs of the banking system, which qualified for immediate reference under IBC.
The total lenders' exposure to the companies stands at about Rs 2 lakh crore, in comparison with the gross NPA tally of Rs 7 lakh crore in the banking sector. Bhushan Steel with a gross debt of over Rs 44,000 crore is most likely the single largest exposure that lenders have on their books.
Next in the pecking order are Bhushan Steel and Bhushan Power with about Rs 35,000 crore debt each. Alok Industries has a debt of around Rs 24,000 crore, while Electrosteel Steels about Rs 10,000 crore and Monnet Ispat’s loan book is pegged at Rs 12,000 crore.
Internal Advisory Committee recommended that banks for such accounts should finalise a resolution plan within six months. In cases where a viable resolution plan is not agreed upon within six months, banks should be required to file for insolvency proceedings under the IBC, the RBI said.
Posted by Sunil Shankar Matkar