Banks refer 8 cases for S4A resolution to Oversight Committee: Sources

As the deadline for cleaning up books nears, public sector banking units are pushing for S4A (Scheme for Sustainable Structuring of Stressed Assets).

According to sources, banks have referred eight cases for S4A to the RBI-mandated Oversight Committee (OC). The debt of these referred cases together totals almost Rs 18,000 crore.

Under the scheme, banks are allowed to classify existing debt as sustainable and unsustainable. Technical viability study helps establish if the company’s current cash flow is capable of servicing the sustainable part of the debt. The unsustainable part is turned into long-dated securities, to be redeemed later.

In the above list, Bombay Rayon has the highest debt of Rs 5,600 crore followed by Supreme Infra with Rs 4,500 crore debt.

Other companies include Soma Enterprises (Rs 4,000 crore debt), NSL Textile (Rs 1,070 crore debt), NSL Sugar (Rs 770 crore), Gama Infra (Rs 900 crore), Amrit Cement (Rs 540 crore) and Santosh Overseas (Rs 425 corre).

So far, only HCC has got the approval for S4A restructuring. The company has got approval from OC to recast its Rs 5,000 crore debt. Of this, 52 percent was found sustainable by the committee.

The Indian banks are looking at Rs 6 lakh crore non-performing assets.