{"id":117449,"date":"2019-04-03T23:15:32","date_gmt":"2019-04-03T23:15:32","guid":{"rendered":"https:\/\/www.bnreport.com\/supreme-court-ruling-to-slow-down-resolution-of-stressed-asses-rating-agencies\/"},"modified":"2019-04-03T23:15:32","modified_gmt":"2019-04-03T23:15:32","slug":"supreme-court-ruling-to-slow-down-resolution-of-stressed-asses-rating-agencies","status":"publish","type":"post","link":"https:\/\/www.bnreport.com\/en\/supreme-court-ruling-to-slow-down-resolution-of-stressed-asses-rating-agencies\/","title":{"rendered":"Supreme Court ruling to slow down resolution of stressed asses: Rating agencies"},"content":{"rendered":"

Mumbai: The Supreme court ruling which relaxes RBI's February 2018 guideline on NPA resolution is expected to impact credit discipline adversely and slowdown resolution of stressed assets<\/a>, according major rating agencies. <\/p>\n

Both Crisil<\/a> and Moodys have voiced their concerns on the impact of the Supreme court ruling which diluted Reserve Bank of Indias directive on its February 2018 circular on NPA resolution. \u201cThe improvement in credit discipline in the past year and the expectation of quick turnaround in stressed assets resolution could come under some cloud\u201d a release by Crisil said. \u201c Thats because the RBI circular prioritised speedy resolution of stressed assets. Also, fear of losing control of their companies meant promoters worked actively with lenders to avoid referral to NCLT\u201d <\/p>\n

On April 2, the Supreme Court passed a judgment that declared a circular issued by the Reserve Bank of India on the recognition and resolution of stressed loans was exceeding the RBI's authority, effectively voiding it. <\/p>\n

The RBI circular had mandated referring stressed assets to the National Company Law Tribunal<\/a> (NCLT) if the banks were not able to implement a resolution plan within 180 days from the date it became overdue. While the RBI circular intended to speed up the resolution process, the apex courts ruling now puts the onus back on banks for ensuring timely and effective resolution of stressed assets, according to Crisil. The provisions of the Insolvency and Bankruptcy Code (IBC), though, continue to be available to them for such resolution. <\/p>\n

The provisions in the supreme court ruling is credit negative for Indian banks, according to global rating firm Moodys, as it will weaken stressed loan recognition and rRead More \u2013 Source<\/strong><\/a><\/p>\n

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Mumbai: The Supreme court ruling which relaxes RBI's Fe..<\/p>\n","protected":false},"author":1,"featured_media":117450,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[202],"tags":[],"class_list":["post-117449","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"yoast_head":"\nSupreme Court ruling to slow down resolution of stressed asses: Rating agencies - Business News Report<\/title>\n<meta name=\"description\" content=\"Mumbai: The Supreme court ruling which relaxes RBI's Fe..\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.bnreport.com\/en\/supreme-court-ruling-to-slow-down-resolution-of-stressed-asses-rating-agencies\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Supreme Court ruling to slow down resolution of stressed asses: Rating agencies - 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