Advertisement

HindustanTimes Sat,12 Jul 2014

RBI may seek details on loans to DCH

HT Correspondent , Hindustan Times  New Delhi, March 29, 2013
First Published: 21:15 IST(29/3/2013) | Last Updated: 21:17 IST(29/3/2013)

Canara Bank, ICICI Bank, Axis Bank and 10 other lenders to Deccan Chronicle Holdings (DCH) are likely to soon meet soon to decide on their future course of action. The ailing media group, which publishes Deccan Chronicle, Asian Age, Financial Chronicle and Andhra Bhoomi newspapers, has defaulted on loans of about Rs. 5,000 crore.

Advertisement

The lenders recently failed to arrive at a consensus on restructuring the company’s debts. “We’re not sure if the collateral pledged with the lending banks covers the entire loan amount,” said a very senior executive at one of the lending banks on condition of anonymity.

The Reserve Bank of India (RBI) is likely to ask the lending banks to provide all details of the loan portfolio, a senior RBI official said. “We may also ask banks to check whether they followed due diligence norms prescribed by RBI.” However, no final decision has been taken in the matter.

“It is a worrisome situation and could turn out to be a big blow for the banking industry,” a senior executive at private sector bank added also on condition of anonymity.

The corporate affairs ministry is also likely to order an investigation into the company’s books of accounts to see if there have been irregularities in their audits, a senior government official said.

Sources added that the auditors of the company could also be pulled up. When contacted, Subodh Kumar Agrawal, president, Institute of Chartered Accountants of India, refused to comment on the issue.


Advertisement
more from Banking

CCEA gives nod for IDFs to take over bank loans

In a move that could boost the cash-starved infrastruc­ture sector, the Cabinet Committee on Economic Affairs on Tuesday gave its clearance for infrastructure debt funds (IDFs) to take over existing bank loans.
markets
Advertisement
Most Popular
Advertisement
Advertisement
Copyright © 2014 HT Media Limited. All Rights Reserved