Bankers’ meet on bad loan accounts begins today

Bankers are meeting from Monday to finalise their next course of action on six of the 12 bad loan accounts for immediate referral to National Company Law Tribunal (NCLT) after the Reserve Bank of India (RBI) named the largest defaulters to face bankruptcy proceedings.

The first set of six troubled accounts are Bhushan Steel (₹44,478 crore), Essar Steel (₹37,284 crore), Bhusan Power and Steel (₹37,248 crore), Alok Industries (₹22,075 crore), Amtek Auto (₹14,074 crore) and Monnet Ispat (₹12,115 crore), a banker said.

According to the central bank, these 12 accounts owe ₹2.5 lakh crore to the system, which constitute around 25% of gross bad loans.

“Beginning Monday, banks are meeting to discuss six of the 12 accounts named by the RBI before referring accounts to the National Company Law Tribunal (NCLT) by the end of this month,” a banker told PTI. Since these are large accounts and involve multiple banks, the lenders will try to take a common view on all administrative requirements before referring them to NCLT. The 12 accounts referred by the RBI have an exposure of over ₹5,000 crore each, with 60% or more classified as bad loans by banks as of March 2016. RBI’s internal advisory committee identified these 12 after studying top 500 ones.