Banks wary of Jaypee Group subsidiaries' debt woes

Jayee Group has total debt of Rs 65000 crore on its books and some of its subsidiaries have been unable to service interest payment dues, reports CNBC-TV18’s Ritu Singh quoting sources. So, they have become stressed accounts but haven’t fallen into the non-performing assets (NPA) category yet. Jaiprakash Power Ventures and Jaypee Infratech have fallen into this special mention account-1 category for banks, which means they have not been able to service debt for sixty days now, say sources. The banks therefore are working on a corrective action plan to prevent these accounts from becoming an NPA, which otherwise will be a big problem for them given their huge exposure to the companies. JP Power alone has Rs 24,000 crore debt and Jaypee Infratech has about Rs 13,000 crore.  ICICI Bank, State Bank of India (SBI) as well IDBI Bank has huge exposure to these particular accounts. According to sources, the corrective action plan could involve sale of non-core assets of the group as well. These non core assets would be JP Power assets - some have already being sold and some will now be put on the block. Assets also include real estate holdings of the company in Noida.