FM to review loan recast, Atmanirbhar package with banks

NEW DELHI: Finance Minister Nirmala Sitharaman will hold a review meeting with heads of banks and NBFCs on Thursday for smooth and speedy implementation of the one-time debt recast for resolution of COVID-19 related stress in bank loans.

The Reserve Bank of India (RBI) last month permitted one-time restructuring of both corporate and retail loans without getting classified as a non-performing asset (NPA).

Banks are in the process of getting a board-approved restructuring framework in line with the RBI's framework and eligibility defined by the central bank in its notification on August 6.

Besides assessing the preparedness of banks on the debt recast, sources said, the meeting will also review the progress of various schemes announced under the Rs 20.97 lakh crore Aatmanirbhar Bharat Abhiyaan.

The progress of Emergency Credit Line Guarantee Scheme (ECLGS) and Credit Guarantee Scheme for Subordinate Debt, among others, will be reviewed in the meeting, sources said.

"The review (meeting) will focus on enabling businesses and households to avail of the revival framework on the basis of viability, necessary steps like finalising bank policies and identifying borrowers, and discussing issues that require addressing for smooth and speedy implementation," the Finance Ministry had said earlier this week.

The finance minister will review the implementation of the resolution framework for COVID-19 related stress in bank loans on Thursday with the top management of scheduled commercial banks and non-banking financial companies (NBFCs), it had said.