Lenders extend inter-creditor agreement for Reliance Commercial Finance till June 30

By: |
May 11, 2021 2:30 AM

The extension of ICA holds importance as it signals that banks are still hopeful about a possible resolution for RCFL. Lenders have a total exposure of Rs 7,626 crore to RCFL, with Bank of Baroda being the lead creditor.

The 14th Finance Commission upped states’ share in divisible tax pool to 42% from 32%.The 14th Finance Commission upped states’ share in divisible tax pool to 42% from 32%.

Lenders to Reliance Commercial Finance (RCFL) have extended the inter-creditor agreement (ICA) till June 30, 2021. The information was disclosed by RCFL’s parent company, Reliance Capital, to the stock exchanges while declaring its quarterly earnings on May 8. The extension of ICA holds importance as it signals that banks are still hopeful about a possible resolution for RCFL. Lenders have a total exposure of Rs 7,626 crore to RCFL, with Bank of Baroda being the lead creditor.

“In the lenders meeting, all lenders had agreed to further extend the ICA period (for RCFL) till June 30, 2021,” Reliance Capital said in its quarterly earnings release. RCFL is confident of implementing its resolution plan within the said extended period, it added.

According to June 7 circular of the Reserve Bank of India, lenders need to extend the time period of the pact if an account has not been resolved within 180 days of signing of the ICA. The lenders had signed the ICA to resolve Reliance Commercial Finance in July 2019. Last year, the company had received expression of interest from few players. However, no final resolution has so far been reached.

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