IFCI slaps suits on 100 defaulters

New Delhi, Dec 6: Coming down heavily on defaulters, IFCI has filed legal suits against 100 erring companies while engaging specialised agencies to recover non-performing assets, which stood at about Rs 3,937 crore till March 01.

“We have filed legal suits against 100 defaulters. We have also issued 33 recovery certificates to various agancies for recovering NPAs,” IFCI chairman VP Singh told PTI but declined to name the companies.
He also made it clear that the legal actions were irrespective of whether the company was a “wilful defaulter” or merely a “defaulter” of paying back IFCI’s loans.

The FI, which plans to bring down its NPA level from over 20 per cent last fiscal levels, has stepped up recovery efforts for bringing down NPA to less than 10 per cent in 2-3 years.

“We have engaged specialised companies and investigative agencies to recover the NPAs,” Mr Singh said. IFCI, whose outstanding loan assistance to industry stood at Rs 19,953 crore last fiscal, was saddled with a net NPA of Rs 3,937 crore.

This was despite a recovery of Rs 3,876 crore worth of NPAs during 2000-01 while it was at Rs 1,528 crore during first six months of this fiscal.

IFCI had to make a higher provision of Rs 252 crore for bad debts as against Rs 74.4 crore during first half of 2000-01, which resulted in a Rs 441.49 crore loss during April-September as compared to Rs 31.1 crore profit during the same period last fiscal.

The dismal condition of IFCI prompted the government to announce a Rs 1,000-crore assistance in August.

In order to improve financials of IFCI by this fiscal, the government has released Rs 400 crore for subscribing to the 20-year convertible debentures of the FI.

The government has also asked IDBI, Life Insurance Corporation and State Bank of India to “expedite” the remaining Rs 600-crore assistance to beleagured IFCI. Mr Singh said IDBI and LIC have in principle agreed to grant Rs 200 crore each to IFCI.

“SBI will take a final decision on the remaining Rs 200-crore assistance after a meeting of its investment committee within next week,” he said.

With the Rs 1,000-crore assistance, IFCI would be able to shore up its capital adequacy ratio and become eligible for market borrowing.

— PTI