Reserve Bank on guard over lenders
The Reserve Bank of India (RBI), which has sought data from lenders on beleagured Satyam Computer Services, has said will wait and watch before taking any decision – which could imply efforts towards recovery.india Updated: Jan 11, 2009 21:00 IST
The Reserve Bank of India (RBI), which has sought data from lenders on beleagured Satyam Computer Services, has said will wait and watch before taking any decision – which could imply efforts towards recovery.
It also indicated that all the lenders of the IT firm – Bank of Baroda, ICICI, BNP Paribas, HSBC, Citibank and HDFC—are adequately capitalised to absorb the loss, in case the firm fails to find a suitor.
“However, in case the company is bought out, there is nothing to worry as the bank loans will be serviced,” a senior RBI executive told Hindustan Times.
The executive added that the data had been asked for to assess the possible impact it could have in case the outstanding amount is not serviced by interest payments.
While BNP Paribas refused to comment, Bank of Baroda Chairman and Managing Director MD Mallya said it will not have any impact.
The outstanding borrowings of the IT firm, as on March 2008, stood at Rs 1,464 crore, according to its balance-sheet. However, this could be balanced against receivables.
Though banks were tightlipped about their individual exposure levels to Satyam, insiders said that this could push up the non-performing level in the near future. But the amount involved is not significant to the banks’ portfolios.
In a bid to avert such frauds in future, banks may want to have a say in the composition of the boards, legal expert Manoj Kumar said.