Lenders extend ICA for Reliance Home Finance resolution till June 30

Reliance Home Finance, Reliance Home Finance resolution,ICA, RHF, RBI, NCLT Mumbai, IDBI Trusteeship

As per June 7 circular of the Reserve Bank of India (RBI), lenders need to extend the time period of the pact if an account has not been resolved within 180 days of signing ICA. The lenders had signed ICA in July last year to resolve RHF. “The resolution of the company depends on the kind of offer we get from management, so far it has not been convincing,” a lender told FE on the condition of anonymity.

Financial creditors have a total exposure of Rs 3,986 crore to RHF. Bank of Baroda (BoB) is the lead creditor to the troubled home financier. The net loss of RHF doubled in the March quarter to Rs 238 crore, compared to a net loss of Rs 110 crore in the same quarter last year.

IDBI Trusteeship had earlier taken RHF to the NCLT Mumbai, claiming a payment of Rs 2,850 crore with interest for the debentures issued by the company. The parent company, Reliance Capital had also been made a respondent in the application on the alleged ground of security provided on its assets up to Rs 707 crore for the debentures of Reliance Home Finance.

SBI Mutual Fund, in November 2019, had completely written down its exposure to RHF, prompting steep cuts in several close ended hybrid schemes of SBI Mutual Fund.

source: financialexpress

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